Yingde Gases Shareholders Vote to Remove Chairman
March 08 2017 - 8:29AM
Dow Jones News
By Rick Carew
Shareholders of China's Yingde Gases Group Co. voted Wednesday
to remove the company's chairman in a rare Chinese boardroom
battle, according to people familiar with the situation, a move
that could push forward a sale of the company.
Allentown, Pa.-based Air Products & Chemicals Inc., a maker
of industrial gases, is offering up to $1.5 billion in a bid to buy
the Hong Kong-listed firm. If its bid is successful, it would mark
the largest takeover of a Chinese firm by a U.S. buyer. It faces
competition from Hong Kong-based private-equity firm PAG Asia
Capital.
Shareholders voted to keep former Chief Executive Sun Zhongguo
and former Chief Operating Officer Trevor Strutt on the board, the
people said. Deal makers and investors close to the situation say
they expect Mr. Sun and Mr. Strutt to move faster to strike a deal
to sell Yingde than the company has thus far under the removed
chairman Zhao Xiangti's leadership. Morgan Stanley is advising
Yingde on the sale process.
The fight over Yingde, which accounts for about 14% of China's
industrial-gas market by revenue, presents an unusual opportunity
for a U.S. buyer to purchase a big Chinese company. Chinese
regulators restrict foreign investment in many sensitive industries
and have nixed high-profile bids for local companies in the past,
including Coca-Cola Co.'s $2.4 billion attempted takeover of China
Huiyuan Juice Group Ltd. in 2009 on antitrust grounds. That has
discouraged other U.S. firms from pursing splashy acquisitions.
The biggest U.S. acquisition of a Chinese company was Joy Global
Inc.'s $1.4 billion purchase of International Mining Machinery
Holdings Ltd. in 2011, according to Dealogic data.
Write to Rick Carew at rick.carew@wsj.com
(END) Dow Jones Newswires
March 08, 2017 08:14 ET (13:14 GMT)
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