One of China’s largest state-controlled oil companies made a $18.5 billion unsolicited bid Thursday for Unocal, signaling the first big takeover battle by a Chinese company for an American corporation.
The bold bid, by the China National Offshore Oil Corporation ( CNOOC), may be a watershed in Chinese corporate behavior, and it demonstrates the increasing influence on Asia of Wall Street’s bare-knuckled takeover tactics.
Seventy-three percent of Unocal’s natural gas reserves are in Asia; this platform is in the Gulf of Thailand.
The offer is also the latest symbol of China’s growing economic power and of the soaring ambitions of its corporate giants, particularly when it comes to the energy resources it needs desperately to continue feeding its rapid growth.
CNOOC’s bid, which comes two months after Unocal agreed to be sold to Chevron, the American energy giant, for $16.4 billion, is expected to incite a potentially costly bidding war over the California-based Unocal, a large independent oil company. CNOOC said its offer represents a premium of about $1.5 billion over the value of Unocal’s deal with Chevron after a $500 million breakup fee.
Moreover, the effort is likely to provoke a fierce debate in Washington about the nation’s trade policies with China and the role of the two governments in the growing trend of deal making between companies in the countries.
This week, a consortium of investors led by the Haier Group, one of China’s biggest companies, moved to acquire the Maytag Corporation, the American appliance maker, for about $1.3 billion, surpassing a bid from a group of American investors.
Last month, Lenovo, China’s largest computer maker, completed its $1.75 billion deal for I.B.M.'s personal computer business, creating the world’s third-largest computer maker after Dell and Hewlett-Packard.
Here they come, supplied with redneck money funneled through your Walmart shopping sprees. Commies buying US companies; weird.
Not that wierd. When China invades Taiwan in a few years they’re going to need all the leverage on the US they can get, to keep the US from immediately jumping into the fight. The longer Taiwan fights alone, the more likely that China can quickly crush them and then hunker down and wait for all the “tut-tut-tut” to blow over. Owning US companies and being able to threaten assorted economic devastation (never mind that any trade war would be far harder on China - they have to keep selling to us to keep their economy going) is a decent tool for getting immediate military responses delayed while “cooler” and “wiser” heads discuss alternatives to fighting.
There’s also Chinese state-owned corporate moves to gain control of at least part of the Panama Canal.
Oh, btw. Long links make baby Rollory cry. Stop it.
You don’t stick troops on a cruiser; you need landing boats and stuff like that basically. Last time I read up on this (a year ago?) they barely had enough to capture the offshore island/atolls or whatever, and had no hope of landing more than a handful of forces.
I have a difficult time believing that a nation with the military and economic power of China has somehow overlooked troop transport whilst spending billions on new nuclear submarines and destroyers. Maybe they plan to rely on quickly converted civilian vessels or re-activating older mothballed ships or somesuch.
Tiawanese website, but I remember reading all that elsewhere. See the “China’s Inability to Invade Taiwan” section; they’d have a hard time establishing air & sea superiority, and even then they don’t have crap for sealift capability. No idea why they bought what they did, but invading Tiawan doesn’t seem to have been #1 on the list.
China’s problem is not possible US military intervention; it’s the fact that their economy is very much reliant on trade with the US. The US wouldn’t need to attack them, it could just start levying sanctions.
Occam’s Razor anyone? Maybe, just maybe a Oil company is buying an Oil company for, uhm, Oil? Unocal’s oil assets are in weird places for an american company but are very naturally placed for a company based in China.
Also China’s energy needs are ramping up quickly it’s not much of a stretch to think that their largest Oil company wants more reserves.
Yeash. Oh and crap Oil just crossed 60 bucks a barrel. God damn it.
A Chinese company is also negotiating to buy Maytag. I for one hope the people of Taiwan are willing to welcome their new, sparklingly clean, mainland Chinese overlords.
If you go looking for evidence that China does not and will not have the capability to invade Taiwan, you will most certainly find it. China does not want the US seriously thinking about a war there, and anything that convinces us it won’t be necessary will be touted and spread around. The Taiwanese also really don’t want to face the idea of a fight with China that they might lose.
However, if you go looking for evidence that, within the next 5 to 10 years, China will have gained all the amphibious and airborne assault capability it currently lacks … then, you will most certainly find that too, because it exists.
There is a lesson in logical fallacies here, a good enough one to make me wish I had better training in that regard.
“I’ll show you damn kids?” China can’t invade right now and doesn’t have anything in the pipeline that would let them. Will change my mind when they start buying.
