US oil and gas giant Exxon Mobil Corp (NYSE:XOM) has mandated Barclays Plc (LON:BARC) to help it sell nearly half of its 60% stake in Hong Kong-based coal-fired power stations operator Castle Peak Power Co Ltd, informed people told Reuters.
According to the sources, Exxon has so far had no luck in its talks to divest the interest to CLP Holdings Ltd (HKG:0002) and state-controlled China Southern Power Grid as they had failed to reach an agreement on the valuation. CLP, which owns the other 40% in the business, is still eager to buy the offered stake as the operation brings guaranteed returns, one of the insiders said.
The auction could lure infrastructure funds, Japanese traders and sovereign wealth funds, the sources said, adding that first-round bids are expected in early April. They noted that the 60% interest was worth some USD3bn (EUR2.3bn) last March and half of it would be valued at nearly USD2bn, including a premium.
None of the parties commented to Reuters.