British Petroleum To Buy Sinopec Stake

BP is likely to buy a 30 percent stake in Sinopec Zhenhai Refining & Chemical, the Chinese largest refinery, after it is privatized by parent Sinopec through a HK$7.67 billion cash offer.

BP, which at present owns 9.41 percent of the company, will have a bigger say in

Sinopec, BP and Zhenhai declined to comment.

BP is seeking to build on its interests in China, the world's second-largest oil consumer, after an attempt to take a substantial stake in Sinopec, the mainland's No2 oil company, was rebuffed, according to media reports.

Zhenhai will serve as vehicle for BP, Europe's largest oil company, to expand its
refinery business in the mainland, where it already owns half of Shanghai SECCO

Petrochemical. Sinopec and Shanghai Petrochemical hold the rest.

Sinopec, or China Petroleum and Chemical Corp, will offer between HK$10.55 and HK$10.60 cash per share to Zhenhai shareholders to privatize the Hong Kong-listed company, sources said.

The offer represents a premium of 11.6 to 12.2 percent over Zhenhai's HK$9.45 closing price before the share was suspended on November 3.