CIC buys stake in French utility unit
Source: Bloomberg News |
August 11, 2011, Thursday
|
Print Edition
Print Edition
GDF Suez SA will sell a 30 percent stake in its exploration and production unit to China Investment Corp for 2.3 billion euros (US$3.3 billion) to cut debt and capitalize on higher demand for energy in Asia.
Europe's largest natural-gas network operator said the sale of the minority stake to China's sovereign fund, also known as CIC, is part of a broader agreement to gain joint investment opportunities in the Asia-Pacific market in particular.
GDF Suez is seeking to accelerate expansion into "high-growth" markets including Asia, where energy use may rise 2.4 percent a year through 2035, said CEO Gerard Mestrallet. The sale takes the utility more than halfway through a plan to sell 10 billion euros of assets.
"It's clear that the emerging countries in general have the highest growth in the world in terms of energy demand," Mestrallet said yesterday in Paris. "CIC is bringing fresh money."
The French utility will also sell a 10 percent stake in the Atlantic liquefied natural gas plant in Trinidad and Tobago to CIC for 600 million euros.
"If CIC closes their eyes for maybe one or two years, when global growth resumes and when the European sovereign debt crisis is solved, then I think their investment in GDF will explode higher," said Gordon Kwan, Hong Kong-based head of regional energy research at Mirae Asset Securities Ltd. "CIC is willing to be very long term."
Europe's largest natural-gas network operator said the sale of the minority stake to China's sovereign fund, also known as CIC, is part of a broader agreement to gain joint investment opportunities in the Asia-Pacific market in particular.
GDF Suez is seeking to accelerate expansion into "high-growth" markets including Asia, where energy use may rise 2.4 percent a year through 2035, said CEO Gerard Mestrallet. The sale takes the utility more than halfway through a plan to sell 10 billion euros of assets.
"It's clear that the emerging countries in general have the highest growth in the world in terms of energy demand," Mestrallet said yesterday in Paris. "CIC is bringing fresh money."
The French utility will also sell a 10 percent stake in the Atlantic liquefied natural gas plant in Trinidad and Tobago to CIC for 600 million euros.
"If CIC closes their eyes for maybe one or two years, when global growth resumes and when the European sovereign debt crisis is solved, then I think their investment in GDF will explode higher," said Gordon Kwan, Hong Kong-based head of regional energy research at Mirae Asset Securities Ltd. "CIC is willing to be very long term."
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