Sinopec Group has confirmed that it has obtained the agreement of the State Council to purchase Canadian oil company Tanganyika (TYK) for 13 billion yuan, China Business News reported on December 15, 2008
Sinopec has offered Tanganyika Oil 31.5 Canadian dollars per share and shareholders have been advised to accept the offer.
Yesterday Tanganyika Oil's stock price stood at 27.69 Canadian dollars per share, lower than Sinopec offer.
Gary Guidry, CEO of Tanganyika Oil said in September that a Sinopec acquisition would be beneficial to both Tanganyika Oil and its shareholders.
Sinopec is to purchase Tanganyika Oil via Sinopec International Petroleum Exploration and Production Corp. (SIPC), one of its subsidiary companies. The acquisition will be entirely funded from SIPC's internal resources. The two companies began negotiating the deal in March 2008 and Sinopec offered the price of 31.5 Canadian dollars per share in August, outbidding its rivals.
Tanganyika Oil is a Canadian company with major operations in Syria. It is part-owned by a Swedish family. TYK generated revenues of US$20.49 million and US$35.91 million and net profits of US$16.31 and US$21.972 in 2006 and 2007, respectively. It produces 830,000 tons of oil per year.
For more details, please read the full story in Chinese. (http://www.china-cbn.com/s/n/000004/20081216/000000104183.shtml)
(China.org.cn December 16, 2008)
