UPDATE 1-CR Power to pay $553 mln for China wind farms

Thu May 9, 2013 9:05pm EDT

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(Adds details, shares to resume trade)

HONG KONG May 10 (Reuters) - China Resources Power Holdings Co Ltd said on Friday it would buy wind farms in 10 provinces in China from its controlling shareholder, sate-owned conglomerate China Resources (Holdings) Co Ltd, for HK$4.3 billion ($553 million).

In a separate statement, China Resources Power said it would merge, as expected, with China Resources Gas Group Ltd and would issue 97 new China Resources Power shares for every 100 China Resources Gas shares held, in a non-cash deal.

The offer represents a value of HK$24.64 per China Resources Gas share, or a premium of 12.8 percent over its last closing price.

The merger will create a $22 billion energy group that can negotiate better terms for natural gas supplies from the state, and analysts have said it will help manage costs and improve efficiency.

It will result in an integrated energy and utility group with operations in more than 20 provinces, autonomous regions and municipalities in China, the world's largest energy consumer, the companies said in a joint statement.

On completion of the merger, shares in China Resources Gas will be withdrawn from the Hong Kong Stock Exchange, and China Resources Power will change its name to China Resources Energy Holdings Ltd.

The new company aims to explore upstream business opportunities in natural gas production such as conventional natural gas, coal mine methane, coke oven gas and other unconventional gas sources such as shale gas.

It may also consider building additional mid-stream infrastructure such as LNG liquefaction facilities to deliver natural gas to China Resources Gas' existing downstream distribution networks.

Shares in both companies, which have been suspended since Monday pending the announcement, will resume trade on Friday.

China Resources Gas has seen its market capitalisation rise 17 times over the last five years to $6.3 billion on growing demand for natural gas from residential users and industries such as petrochemicals, ceramics and glass.

China Resources Power is an independent electricity producer that relies on coal for over 92 percent of its power generating capacity.

For a statement on the acquisition please click here

For a statement on the merger please click here

($1 = 7.7590 Hong Kong dollars) (Reporting by Donny Kwok; Editing by Anne Marie Roantree and Daniel Magnowski)

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