China National Petroleum Corporation (CNPC) announced Thursday morning it has successfully acquired Canada-based PetroKazakhstan Inc. (PK) through its wholly-owned subsidiary CNPCI.
Wednesday morning, Canadian time, the China's largest oil producer saw its planned acquisition of PK through CNPCI was granted "unconditional" final order by the Queen's Bench Court, Calgary, Canada.
CNPC's bid for PK is 55 US dollars per share, totaling 4.18 billion US dollars, the largest overseas takeover transaction ever made by a Chinese company.
Lukoil of Russia, one of CNPC's major rival in the deal made no appeal, indicating the completion of all legal procedures of the transaction.
To date, the transaction has been completed, announced CNPC.
At local time Wednesday afternoon, Chinese Premier Wen Jiabao met Kazakhstan Prime Minister Danial Akhmetov in Moscow, when attending the
Shanghai Cooperation Organization Summit.
Both Premier and the prime minister expressed their strong support for the mutual-benefit cooperation between CNPC and KazMunaiGaz over PK after the completion of the acquisition.
Kazakh Prime Minister promised to help to resolve all remained problems of PK in Kazakhstan together with CNPC after the deal is closed.
Early in the shareholders meeting of PK held last Tuesday, 99.04 percent of all the voting shares were affirmative for the acquisition.
According to relevant transaction procedures, the outcome of the shareholders meeting needs to be sanctioned by the Canadian court.
However, in the court hearing of last Tuesday, the lawyer of Lukoil claimed that the company has the first right of refusal to buy a 50 percent stake in Turgai Petroleum, a joint venture between PK and Lukoil. In this connection, the Court postponed its ruling to Wednesday.
CNPC and PK concluded the negotiation on August 21 over the transaction with the signing of the"Arrangement Agreement".
According to CNPC, after two months of heavy workload, all formal approvals and legal procedures have been obtained and completed. At present, CNPC staff is working with PK and the hand-over of business is under way. Operation of PK is maintained as usual, and employees are unaffected.
PK Inc is an international energy company registered in Canada, with all of its assets, such as oilfields and refineries, in the Republic of Kazakhstan. PK's total annual production capacity of crude oil exceeds seven million tons.
Since its first presence in Kazakhstan in 1997, CNPC has developed good relationship with local government by strictly following local laws and regulations as well as international best practices of the industry.
Upon acquisition, in the spirit of win-win and mutual benefit, CNPC will choose to cooperate with KazMunaiGaz, the state oil company of Kazakhstan to operate and manage the PK project, said CNPC.
The two parties signed a memorandum of understanding on Oct. 15, according to which KazMunaiGas will obtain a certain amount of PK shares enough to have strategic control over the development of the country's mineral resources, together with the equal right for joint management over Shymkent refinery and its products.
PK owns 12 oil fields, and exploration licenses in 6 blocks in Kazakhstan, with great exploration potential.
CNPC said it is confident that taking advantage of CNPC's strength in capital, technology and management, as well as CNPC's valuable experience in Kazakhstan, the production capacity of PK will be increased, and thus provides the Sino-Kazakhstan oil pipeline expected to be completed at the end of this year with a reliable supply.
The increase of investment in Kazakhstan and the acceleration of PK's development will help to ensure the stable supply of oil products of the country and boost local economy, said the company.
