The Board of Directors of PetroKazakhstan Inc (PK) has approved
the acquisition proposal of China National Petroleum Corporation
International (CNPCI) and will recommend that its shareholders
accept the offer, sources with the China National Petroleum
Corporation (CNPC) said on
Tuesday.
CNPC, China's largest oil producer, announced on Monday that it
had made an offer to acquire PK, a Canada-based company, through
its wholly owned subsidiary CNPCI, at US$55 per share in cash for
all shares in PK.
The offer, totaling US$4.18 billion, represents a premium of
24.4 percent based on the weighted average closing price of PK
common shares on the New York Stock Exchange for the twenty
previous trading days ending Friday August 19.
If successful, it would be the biggest overseas acquisition
transaction made by a Chinese company.
According to an announcement published on PK website, the
transaction requires the approval of 66 percent of PK shareholders
at a meeting expected to be held in October. Other conditions
include court approvals.
According to the agreement between CNPCI and PK, the Board of
Directors of PK can recommend a more preferential proposal to its
shareholders. However, if it terminates its agreement with CNPCI
before the specified offer expiry date, PK will have to pay an
early termination fee of US$125 million.
Registered in Canada, PK is a vertically integrated
international energy company listed in the United States, Canada,
the United Kingdom, Germany and Kazakhstan with an annual oil
output of over seven billion tons.
(Xinhua News Agency August 24, 2005)