Goldman deal in China passes regulatory hurdle http://today.reuters.com/news/articleinvesting.aspx?type=mergersNews&storyID=2006-08-16T125148Z_01_PEK190718_RTRIDST_0_FOOD-CHINA-GOLDMAN.XML
Wed Aug 16, 2006
SHANGHAI, Aug 16 (Reuters) - A consortium led by Goldman Sachs (GS.N: Quote, Profile, Research) has passed a major regulatory hurdle in its effort to buy China's biggest meat-processing firm -- a positive sign for other foreign investment deals in the country.
The Assets Supervision and Administration Commission has approved the consortium's winning bid, about 2 billion yuan (US$250 million), for the Shuanghui group, said Shuanghui affiliate Henan Shuanghui Investment & Development Co. (000895.SZ: Quote, Profile, Research) on Wednesday. The deal still needs the approval of China's commerce ministry, the statement to the Shenzhen Stock Exchange added. But the ministry has usually followed the decision of the cabinet-level commission in the past.
The consortium, Rotary Vortex, had been waiting for regulatory approval since agreeing in May to buy Shuanghui, also known as Shineway Group. The delay caused concern among foreign investment bankers, because China has in recent months tightened its supervision of takeovers by foreigners, with some officials complaining that the country is selling its assets too cheaply.
Another big takeover, a $375 million deal for U.S. investment firm Carlyle [CYL.UL] to buy 85 percent of China's biggest heavy machinery maker, Xugong Construction Machinery, has been awaiting regulatory approval since last October.
The government has been conducting high-level hearings on the Carlyle deal, and official media have said regulators are likely to make a decision on whether to approve it in coming weeks. ($1 = 8.0 yuan)
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