CTG to Drop EDP Pursuit if Voting Rights Cap Is Maintained

   By Nathan Allen

China Three Gorges Corp. said Monday that it will abandon its 9.07 billion euro ($10.20 billion) takeover bid for EDP-Energias de Portugal SA (EDP.LB) if shareholders vote to maintain a 25% cap on voting rights at the forthcoming general meeting.

Portugal's market regulator, the CMVM, had previously said that if the takeover is to proceed, EDP's shareholders must vote in favor of a motion proposed by activist investor Elliott Management Corp. to scrap the voting-rights limit.

China Three Gorges said it would abide by the CMVM's ruling and will remain a strategic partner to the company regardless of the vote's outcome.

The Chinese state-owned energy group, which holds a stake of around 23% in EDP, launched its offer to take over the remaining equity last May, but it has been dismissed by EDP's board and Elliott Management, which holds a 2.9% stake, as too low.

Regulators in the U.S. and the European Union have also voiced concerns about handing over control of power-generation assets to a Chinese state company.

EDP's shareholders will vote on the motion on Wednesday.

Write to Nathan Allen at nathan.allen@dowjones.com

(END) Dow Jones Newswires

April 23, 2019 03:02 ET (07:02 GMT)

EDP Renovaveis (PK) (USOTC:EDRVY)
Historical Stock Chart
From Mar 2024 to Apr 2024