Suitors short-listed for stake in Sinopec Sales
Print Edition
CANADIAN retailer Alimentation Couche-Tard Inc and China’s Tencent Holdings Ltd are among suitors short-listed to buy a US$16 billion minority stake in China’s Sinopec Sales, the world’s largest fuel retail network, people familiar with the matter said.
China Life Insurance Co, the nation’s biggest insurer, Hong Kong-listed ENN Energy Holdings Ltd, privately-owned Fosun Group, Hopu Investment Management and Affinity Equity Partners have also progressed to the next round, said the people who declined to be identified as the sale process is confidential.
Formally known as China Petroleum and Chemical Corp, state-run Sinopec plans to sell up to 30 percent of Sinopec Sales by end-2014 as Beijing restructures government-owned assets. Sinopec Sales’ net profit was 25.1 billion yuan (US$4.1 billion) in 2013 from over 30,000 service stations and more than 23,000 convenience stores.
While a deal would give investors little control over the company, a likely exit through an initial public offering planned within three years has attracted a wide range of suitors, the people said.
The firm also wants to boost non-fuel sales and is seeking investors for car services, telematics, online-to-offline sales, financial services and advertising, the sources added.
Sinopec Sales generated 1.49 trillion yuan in revenue in 2013, but contribution of non-fuel sales was below 1 percent of the total. In the United States, for example, non-fuel retail sales account for about half the profit for gas stations.
Sinopec, ENN, Affinity, Tencent, China Life and Fosun all declined to comment about the bidding process.
In a statement, Couche-Tard said it had no plan to invest in Sinopec “at this time.”
Privately-owned Chinese investor New Hope did not reply to e-mails seeking response. Hopu could not be reached for an immediate comment.
Final bids are due by end-August, though it was not clear how many short-listed bidders are likely to make offers. Couche-Tard and ENN are both bidding solo, as is New Hope Group, the people said.
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