State fund to help Sinopec parent acquire overseas assets

China Investment Corp is planning to inject funds into China Petrochemical Corp (CPC), the parent company of Sinopec Corp, to help it acquire overseas assets, the China Business News reported yesterday.

The move comes hard on the heels of the state investment fund's US$5 billion cash injection into Wall Street bank Morgan Stanley and will be its second investment in a state-owned enterprise after buying US$100 million worth of shares in China Railway Group last month.

CIC refused to confirm the plans yesterday while China Petrochemical and Sinopec were unavailable for comment.

'CIC will not comment on media speculation,' a spokesperson for the state investment fund said.

CPC is the first enterprise to receive financial support since the State-owned Assets Supervision and Administration Commission (Sasac) agreed that CIC should provide capital to state-owned enterprises expanding overseas, the newspaper said.

The details of how the cash injection will be managed have yet to be settled. One likely possibility is that CIC would work with Sinopec's parent on developing projects overseas and then transfer the assets to the listed company, according to an unidentified source cited by the newspaper.