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New China Energy Star Still Hungry After $9 Billion Rosneft Deal

Source: Bloomberg 9/14/2017, Location: Asia

A $9 billion stake in one of the world's biggest oil companies may not be enough for CEFC China Energy Co. A week after China's largest private energy company struck a deal for a chunk of Rosneft PJSC, it's been pegged as a possible investor in a Russian metals and power business and a free-trade zone in Georgia's Black Sea port of Poti.

The Rosneft deal has thrust CEFC into the spotlight, transforming it from an obscure conglomerate focused mainly on the former Soviet Union and eastern Europe into a conspicuous player on the world energy stage, mixing with the likes of Glencore Plc. This rapid metamorphosis is raising curiosity about the company's origins, how close it is to the government and how it's funding the expansion.

"It's surprising because this little-known company has been able to do the type of large-scale transactions that are left to state-owned energy companies,"? said Laban Yu, head of Asia oil and gas equities at Jefferies Group LLC in Hong Kong. "Many people have never heard of it and don't know where the funds for these acquisitions are coming from."?

Starting as a small trading company in 2002, CEFC has grabbed assets including storage, terminals, refineries and oil fields, as well as financial businesses. In its statement on the Rosneft deal, CEFC described itself as the country's largest private oil and gas company, with 50,000 employees and revenue of more than $40 billion.

The Chinese company is considering the acquisition of a 75 percent stake in the Poti Free Industrial Zone, Giorgi Gakharia, Georgia's economy minister, said in an interview in Tbilisi on Wednesday. Gakharia said he plans to travel to China sometime next week to sign the deal for the port area, which includes chemical and steel industries and light manufacturing.

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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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