CEFC China Energy Co. Ltd. decided to withdraw its request with the Czech central bank to approve a stake increase in J&T Finance Group SE due to upcoming ownership changes at the Chinese company, CEFC Europe said March 19.
Further actions regarding raising the stake in J&T Finance Group will be discussed with partners after a new minority shareholder joins CEFC Europe, the company noted. Reuters reported March 20 that China's state-owned CITIC Group Corp. is in negotiations to acquire a stake of up to 49% in CEFC China's European unit.
CEFC China will continue its other projects in the Czech Republic, and also confirmed its intention to repay a loan it received from J&T Finance Group, CEFC Europe noted in its filing.
The Czech unit also said that CEFC China Chairman Ye Jianming will step down from the post and will no longer be the company's shareholder. Jianming is investigated in China over suspected economic crimes, but CEFC Europe said that the group itself is not subject to the investigation.
CEFC China, which owns a 9.9% stake in J&T Finance, agreed to increase its holding in the company to 50% in 2016. The deal gained the approval of the European Central Bank and several national regulators, but the Czech central bank refused to approve the acquisition in January due the lack of sufficient information from CEFC regarding the origin of funding for the transaction.
J&T Finance Group controls several banks in Central and Eastern Europe, including Czech lender J&T Banka a.s. and its Croatian unit J&T banka d.d., Slovak lender Poštová banka a.s. and Russia-based J&T Bank a.o.