MIE Holdings (HKG:1555) announced that it has agreed to acquire existing shares of target company Sino Gas & Energy Limited (ACN 115 316 599), and new shares and loan notes issued by the target company at a total consideration of US$100 million (HK$780 million). The acquisition will be financed from the MIE group's existing cash resources and/or bank financing.

Immediately after completion of the acquisition, MIE will hold 51% of the share capital of the target company.

Trading in the shares of MIE will resume from 1:00 p.m. today.

The principal business activity of the target company is the exploration of unconventional gas assets in China pursuant to two PSCs, namely Linxing PSC and Sanjiaobei PSC, both of which are located on the eastern flank of the Ordos Basin. The contracted area is approximately 1,874 square kilometres for Linxing PSC and 1,124 square kilometres for Sanjiaobei PSC.

The target company entered into the Linxing PSC with China United Coal Bed Methane Co. (CUCBM) and entered into the Sanjiaobei PSC with PetroChina Coalbed Methane Company Limited (PetroChina CBM).

MIE's board of directors says that the acquisition represents an outstanding opportunity to gain access to the developing Chinese gas market at an attractive entry point capitalizing on the combination of a large scale project, strong management team and growing market with robust gas price.

Source:chinesestock.org