Liu Minghui and firm he partnered with sell 1.8 percent stake for HK$ 320 million

Liu Minghui, founder of China Gas Holdings Ltd., and energy company Fortune Oil Holdings Ltd. sold a 1.8 percent stake of China Gas for HK$ 4.03 per share.

The stocks were worth HK$ 320 million, Hong Kong Securities and Futures Commission said on July 11.

It was the first time Liu sold a stake in China Gas since state-run China Petrochemical Corp. (Sinopec) and privately held ENN Energy Service Co. Ltd. joined forces in a hostile takeover bid for China Gas in December 2011.

Beijing Enterprises Group, a state-owned company under the Beijing municipal government, purchased a 2.3 percent stake in China Gas for HK$ 400 million on July 11.

It has been the largest shareholder of China Gas since it spent HK$ 519 million to buy 132 million shares in June. Beijing Enterprises owns 20.3 percent of the firm.

Beijing Enterprises won’t take over the company completely, a source close to China Gas said. But China Gas was willing to have Beijing Enterprises as its largest shareholder to put an end to scattered stake holding.

After Sinopec and ENN made the takeover offer in December, it was rejected by the China Gas board of directors, who called it “totally uninvited” and “opportunistic.” The board said the bid “failed to reflect the underlying value of the company.”

To beat back the raiders, Liu partnered with energy company Fortune Oil Holdings. Together, they started increasing their China Gas holdings.

Liu and Fortune Oil formed a “persons acting in concert” to act as a single investor. By end of May, the team had become the largest shareholder, with a 17.3 percent stake.

Beijing Enterprises invested in China Gas piecemeal starting in May, according to the Hong Kong Securities and Futures Commission. Eight share purchases gradually raised its stake to more than 14.9 percent, making it the company’s third-largest shareholder.

By intern staff reporter Dai Tian