Clifford Chance

Clifford Chance advises AEI on sale of China gas distribution business

Leading international law firm Clifford Chance has advised AEI Asia Ltd. ("AEI") on the entry into an agreement for the sale of its China gas distribution business to China Resources Gas Group Limited for US$237 million. The transaction is particularly complex with 40 target companies engaged in gas sales, distribution and transportation in Mainland China. AEI China Gas Group  operates 28 city gas projects, 8 gas stations and 4 midstream gas transmission pipeline projects in 11 provinces in mainland China.

AEI's parent company owns and operates interests in power generation assets as well as natural gas transportation and distribution businesses in 10 emerging markets with an electric power generation capacity of 1,761 MW, with an additional 951 MW under construction.

China Resources Gas is a Hong Kong listed company principally engaged in city gas distribution in China.

"Energy is a key sector in China, and China has become one of the world's top 10 countries in terms of natural gas consumption," said Shanghai Corporate partner Kelly Gregory who led the team on this transaction. "We're likely to see continued investment and consolidation in this industry given China's determination to enhance 'cleaner' energy use through policy and regulation, and by developing infrastructure". Tokyo Corporate partner Andrew Whan added "We are delighted to have assisted AEI again in respect of this divestment, with our US Corporate partner David Brinton, US Projects partner Fabricio Longhin and UK Corporate partner Mark Carroll having assisted on a series of other divestments for AEI globally over the last 12 months".

Kelly led the deal and was assisted by Corporate partner Andrew Whan in Tokyo, senior associate Isaac Stewart in Hong Kong and associate Zhonghua Shi in Beijing.