Chinese officials have ordered state companies to meet investment bankers to explore ways to block BHP Billiton's £25bn bid for Potash Corporation, according to Reuters reports. In response to the directive, Sinochem is holding meetings with several banks, including Citigroup, HSBC, and Morgan Stanley.
The order from Beijing underscores the seriousness with which China is taking the potential BHP-Potash tie-up and its implications for the pricing and supply of the crop nutrient, despite obstacles to launching a successful counter-bid.
"They are being instructed. The chairman of Sinochem has been asked to speak to other banks", a source said, adding the order was issued late last week.
A Wall Street Journal report on Thursday said Sinochem had hired HSBC to advise on options pertaining to Potash. One option being discussed is the possibility of Sinochem teaming up with China's $300bn (£194bn) sovereign fund.Reuse content