SGCC's Forced Divestment Is Shenhua's Gain

China's largest electricity transmission and distribution company State Grid Corporation of China (SGCC) is potentially divesting up to CNY55bn (US$8.7bn) worth of coal and power generation assets to Shenhua Group, the parent company of China's largest integrated coal-based energy company China Shenhua Energy. CFW believes the potential sale is another indication of China's plans to restructure the electricity sector. The sale would also have a material benefit for Shenhua, as it would strengthen the company's portfolio in the coal and electricity generation sectors.

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