Three Gorges Nears $2 Billion Unit Stake Sale to CNIC, GIC
Three Gorges Nears $2 Billion Unit Stake Sale to CNIC, GIC Group
(Bloomberg) -- A consortium that includes CNIC Corp. and GIC Pte are nearing a deal with China Three Gorges Corp. for a 25% stake in its overseas asset portfolio that could be valued at as much as $2 billion, according to people familiar with the matter.
The group could reach a deal to buy the stake in China Three Gorges’ international unit as soon as this week, one of the people said, asking not to be identified as the matter is private.
The consortium also includes other funds in Greater China, the people said. Bloomberg News reported in March that Chinese state-backed fund CNIC and Singaporean sovereign wealth investor GIC were among those in talks for the asset.
The hydropower company plans to use the funds raised in the potential deal to fund development of the overseas portfolio, including acquisitions, the person said.
A $2 billion transaction would be the company’s second biggest disposal, according to data compiled by Bloomberg. In 2016 it completed the sale of Three Gorges Jinshajiang Chuanyun Hydro Development Co. for 30 billion yuan ($4.6 billion) to China Yangtze Power Co., in which China Three Gorges has a majority stake.
Negotiations are ongoing and China Three Gorges could still decide not to sell the assets, the people said. A representative for GIC declined to comment. Representatives for China Three Gorges and CNIC did not immediately respond to requests for comment.
China Three Gorges has continued its decade-long run of acquiring overseas assets even after the U.S. Department of Defense added it to a list of firms said to have ties to the Chinese military, barring them from U.S. exchanges.
The state-owned power giant’s subsidiary China Three Gorges Renewables Group Co. raised 22.7 billion yuan ($3.5 billion) last month in an initial public offering in Shanghai, the country’s biggest this year.
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With assistance from Bloomberg