December 15 (SeeNews) - KMG International NV (KMGI), the major shareholder of Romania's Rompetrol Rafinare, said on Thursday that negotiations between the National Company KazMunayGas of Kazakhstan (KMG NC) and China Energy Company Limited (CEFC) for the purchase of 51% of KMGI's shares have reached the final stage.
"Thus, an agreement between KMG NC and CEFC stating the strong commitment to pursue the transaction is expected to be signed, along with a restated set of documents, thus confirming the solid partnership between the two companies," KMGI said in a press release.
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Romania's Rompetrol Rafinare is the core asset of Dutch-based KMGI, formerly The Rompetrol Group, which is fully owned by state-owned energy group KazMunaiGaz.
"The assets owned and operations carried out by KMGI in Europe and in the Black Sea region will serve as a development platform that will target both the increasing of operational and financial performance of KMGI and expanding at the international level of dedicated activities and operations performed by CEFC," it added.
In April, CEFC signed an agreement to acquire 51% of KMGI's European assets for $680 million (597 million euro) as part of a strategic partnership deal it signed with KMGI's sole owner KazMunayGas in December 2015. At the time, both companies expected to finalise the transaction by October.
CEFC said in April it planned to set up an energy investment and development fund, to acquire more gas station terminals globally and to explore the downstream logistics system and the equities and rights of oil and gas resources, once the transaction was completed.
KMGI owns filling stations chain Rompetrol and operates two oil refineries in Romania, Petromidia Navodari and Vega Ploiesti. It also owns filling stations in Moldova and Bulgaria and France via Dyneff company. In July KMGI sold a 51% stake in Dyneff to CEFC.
Rompetrol was privatized in 1993 by Management and Employee Buy Out (MEBO) and later in 1998, it was bought by a local investor group led by Dinu Patriciu. In August 2007, KazMunayGas acquired 75% of the Rompetrol shares from their owner Dinu Patriciu for around 2.5 billion euro.
In July, KMGI said it is seeking international arbitration against Romania over the seizure of 3 billion lei ($738 million/671 million euro) of assets in May in a tax fraud probe. Romania's anti-organised crime investigation unit DIICOT seized the assets as part of an investigation into suspected violations related to the privatisation of Rompetrol group.
($ =0.9398 euro)