Skip to main content

More Whispers On Shenhua

Shenhua Energy, the world's second-largest coal company, could raise almost US$80 billion to spend buying mines, power plants and ports to feed China's growing demand for energy. The mining company is in preliminary talks to invest in Indonesia (Adaro, read below) and is studying targets in Australia and Mongolia, president Ling Wen said on Friday. Shenhua has been forced to move a lot faster in its M&A strategy thanks to BHP Billiton's audacious bid for Rio Tinto. The $US134 billion unsolicited takeover bid for Rio Tinto Group by BHP Billiton, the world's biggest mining company, may accelerate those plans. There are only so many decent sized mines left to acquire that would help make a difference to Shenhua over the longer term. After all, it IS the world's second largest coal company, and wants to at least stay there if not improve further.

"It's very important to use not only organic growth but also mergers and acquisitions to make our enterprise larger, better and more profitable," Mr Ling said in an interview in Beijing. "We have huge room to make some acquisitions."

China Shenhua would be able to finance takeovers because its parent, state-owned Shenhua Group, owns a 74%. China Shenhua would be able to liberate $US78.5 billion by selling new shares and diluting its parent's stake to just over 50 per cent. China, the largest energy consumer after the US, burns coal to generate almost 80 per cent of its power. The Government estimates energy demand will rise about 4 per cent annually to the equivalent of 2.7 billion tonnes of coal by 2010. China's gross domestic product grew 11.5 per cent in the third quarter.

The price of shares in China Shenhua, which ranks behind St Louis-based Peabody Energy in coal sales, have more than doubled this year, outpacing the 43 per cent advance in the benchmark Hang Seng Index. The parent's stake dropped from 81% after the company raised 66.6 billion yuan in a Shanghai share sale in October. The stock has fallen 7% since then.

Comments

Popular posts from this blog

My Master, A National Treasure

REPOST:  Its been more than two years since I posted on my sifu. This is probably the most significant posting I had done thus far that does not involve business or politics. My circle of close friends and business colleagues have benefited significantly from his treatment.


My Master, Dr. Law Chin Han (from my iPhone)

Where shall I start? OK, just based on real life experiences of those who are close to me. The entire Tong family (Bukit Kiara Properties) absolutely swear that he is the master of masters when it comes to acupuncture (and dentistry as well). To me, you can probably find many great dentists, but to find a real Master in acupuncture, thats a whole different ballgame.


I am not big aficionado of Chinese medicine or acupuncture initially. I guess you have to go through the whole shebang to appreciate the real life changing effects from a master.


My business partner and very close friend went to him after 15 years of persistent gout problem, he will get his heavy attacks at least…

PUC - An Assessment

PUC has tried to reinvent itself following the untimely passing of its founder last year. His younger brother, who was highly successful in his own right, was running Pictureworks in a number of countries in Asia.

The Shares Price Rise & Possible Catalysts

Share price has broken its all time high comfortably. The rise has been steady and not at all volatile, accompanied by steady volume, which would indicate longer term investors and some funds already accumulating nd not selling back to the market.


Potential Catalyst #1

The just launched Presto app. Tried it and went to the briefing. Its a game changer for PUC for sure. They have already indicated that the e-wallet will be launched only in 1Q2018. Now what is Presto, why Presto. Its very much like Lazada or eBay or Alibaba. Lazada is a platform for retailers to sell, full stop. eBay is more for the personal one man operations. Alibaba is more for wholesalers and distributors.

Presto links retailers/f&b/services originators with en…

How Long Will The Bull Lasts For Malaysia

Are we in a bull run? Of course we are. Not to labour the point but I highlighted the start of the bull run back in January this year... and got a lot of naysayers but never mind:






























p/s: needless to say, this is Jing Tian ... beautiful face and a certain kind of freshness in her looks and acting career thus far



http://malaysiafinance.blogspot.my/2016/12/bank-negara-may-have-switched-on-bull.html


I would like to extend my prediction that the bull run for Bursa stocks should continue to run well till the end of the year. What we are seeing for the past 3 weeks was a general lull where volume suddenly shrunk but the general trend is still intact. My reasons for saying so:

a) the overall equity markets globally will be supported by a benign recovery complemented by a timid approach to raising rates by most central banks

b) thanks to a drastic bear run for most commodities, and to a lesser extent some oil & gas players, the undertone for "cost of materials" have been weak and has pr…