Bloomberg
China’s big oil companies may face U.S. exit after telecommunications cut
(Bloomberg) – China’s top oil companies may be next in line for US delisting after the New York Stock Exchange announced last week that it would remove the three largest telecommunications companies in the Asian country. China’s largest offshore oil producer, CNOOC Ltd., could be at risk as it is on the Pentagon’s list of companies it says are owned or controlled by Chinese military personnel, according to Bloomberg Intelligence analyst Henik Fung. PetroChina Co. Ltd. and China Petroleum and Chemical Corp., also known as Sinopec, may also be under threat as the energy sector is crucial to China’s military, he said. “More Chinese companies can be removed from the United States list and the big oil companies could come as the next wave,” said Steven Leung, executive director of UOB Kay Hian in Hong Kong. At the same time, the impact of the removal of the telecommunications companies is likely to be minimal, since they were little traded in the United States and did not raise a lot of funds there, he said. The NYSE said it would withdraw telecom operators to comply with a U.S. executive order by imposing restrictions on companies identified as affiliated with the Chinese army. China Mobile Ltd., China Telecom Corp Ltd. and China Unicom Hong Kong Ltd. would all be suspended from trading between January 7 and 11, and procedures to withdraw them have been initiated, the exchange said. In separate statements on Monday, each The company said it “regrets” NYSE shares and said the decision could affect the company’s share prices and turnover. All three companies said they had received no notification from the NYSE about the closing of the exchange. Protecting interests China Unicom and China Mobile said they are reviewing ways to protect companies’ “legal rights”. China Telecom said it is considering “corresponding options” to “safeguard the company’s legitimate interests”. Read more: TikTok, Hong Kong and more US-China points of interest: QuickTakeChina’s Ministry of Commerce responded on Saturday, saying the country would take the necessary steps to protect the rights of Chinese companies and hopes that the two countries can work together to create a fair and predictable environment for companies and investors. The Securities and Exchange Commission of China said on Sunday that, due to the small number of shares traded in the United States, the impact on telecommunications companies would be limited and that they are well positioned to deal with any consequences of going public. China says closing its telecoms giants on the NYSE has limited impact “The recent move by some political forces in the United States to continually suppress foreign companies listed in the US markets without any foundation, even at the expense of undermining their own position in global capital markets, it has shown that US rules and institutions can become arbitrary, reckless and unpredictable, ”said the CSRC in a statement on its website. U.S. President Donald Trump signed an order in November to stop American investments in Chinese companies owned or controlled by the military in an attempt to put pressure on Beijing over what it considers abusive business practices. The order prohibited American investors from buying and selling shares in a list of Chinese companies designated by the Pentagon as having military ties. China’s Foreign Ministry later accused the United States of “cruelly slandering” its civil-military integration policies and promised to protect the country’s companies. Chinese officials have also threatened to respond to previous Trump administration actions with their own blacklist of American companies. (Updates with the reaction of China Mobile and China Unicom in the fifth paragraph) For more articles like this, visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source. © 2021 Bloomberg LP