China Aviation (G92.SI) saw its stock price surge 3.95% in pre-market trading on Tuesday, following reports that China's largest oil refiner, Sinopec, is in discussions to take over the nation's dominant jet fuel distributor, China National Aviation Fuel (CNAF).
The potential tie-up, reportedly initiated by Beijing, could have significant implications for China Aviation Oil, which is 51% owned by CNAF. If the deal moves forward, Sinopec is expected to absorb all of CNAF's assets and operations, potentially including its stake in China Aviation Oil.
Investors appear to be reacting positively to this news, likely seeing potential benefits from being associated with Sinopec, a major player in China's oil industry. The merger could potentially provide China Aviation Oil with access to Sinopec's vast resources and strong market position, which could enhance its operational capabilities and market reach in the aviation fuel sector.
As negotiations are still ongoing, market participants will be closely watching for further developments on this potential industry-reshaping deal. The stock's movement suggests optimism about the company's future prospects in light of these talks.