CNOOC’s Nexen Bid: Where’s the Noise? 中海油收购尼克森：争议在哪？
I have to admit that I’ve been quite surprised by the lack of noise coming from North American politicians in the month since Chinese oil major CNOOC (HKEx: 883; NYSE: CEO) announced its landmark plan to buy Canadian oil giant Nexen (Toronto: NXY) in a deal valued at $15.1 billion. In fact, you could say the silence over that period has been almost deafening, with the lack of noise only ending late last week when Nexen made the low-key announcement that it has scheduled a meeting on September 20 for its shareholders to vote on the deal. (English article)
My only guess is that perhaps after years of China bashing, US and Canadian politicians are finally tiring of using China as an excuse for all their economic woes and realizing they need to focus on real issues as the US heads into its November presidential elections and both countries focus on the real work of trying to improve their sluggish economies. If that’s the case, then this is certainly an important development with huge implications for deals between China and the West, as it means that perhaps western markets are finally preparing to put politics aside and focus on real issues like restoring economic growth and protecting national security if and when cross-border activity creates real concerns.
CNOOC made headlines back in July when it first announced its plan to buy Nexen for C$27.50 per share, marking a 60 percent premium to Nexen’s share price before the announcement. Observers credited CNOOC with taking a smart approach to ease political concerns, including plans to list CNOOC shares in Toronoto and to keep a major North American presence at Nexen’s Calagary headquarters. Investors have responded relatively positively to the deal, with Nexen shares last trading at C$25.45, or a respectable 7 percent below the offer price.
Canadian officials would clearly have the strongest case for blocking a deal, but have remained largely silent since the original announcement. Equally surprising has been the quiet from US politicians, who could also try to block the US approval needed for the deal due to Nexen’s ownership of assets in US territory. We did hear a little such noise from US politicians right after the news was announced, but the talk was mostly about attaching conditions to approval of the deal rather than trying to kill it.
In fact, this is just the latest case of US politicians being silent about a deal that in earlier times probably would have attracted much more scrutiny and noise-making. I previously predicted that a deal announced in May for Chinese real estate group Wanda to buy US movie theater chain AMC could run into trouble due to political sensitives, but we’ve heard little or nothing in terms of such opposition in the 3 months since then. (previous post) The same has been true for another deal involving an infrastructure loan in San Francisco by China Development Bank, which I also predicted might run into trouble. (previous post)
Its probably too early to say that this notable lack of noise in the CNOOC-Nexen deal means the days of China-bashing in the US and Canada are in the past, and that all cross-border M&A will now proceed smoothly. But certainly this newfound silence is encouraging, and could mean that North American politicians will finally focus their attention on important issues rather than trying to block deals that pose little or no threat.
Bottom line: The lack of noise by North American politicians surrounding CNOOC’s plan to buy Canada’s Nexen could auger well for both completion of the deal and for future similar M&A.
Related postings 相关文章:
