HNA Innovation Finance Group is a new finance company launched by Chinese conglomerate HNA Group in Hong Kong.
Its transaction with Glencore will pave way for a new company named HG Storage International with an aim to consolidate the current petroleum products storage and logistics businesses of the Swiss firm into a global portfolio of high-potential assets.
The partners expect to give an established presence for HG Storage in important trading hubs and strategically important regions in Europe, Africa and the Americas.
Glencore Oil head Alex Beard said: “HG Storage brings together Glencore’s expertise in the petroleum products storage business and extensive market knowledge with HNA’s global reach and strong position in Asia.
“HG Storage’s high quality assets are well positioned to take advantage of the future opportunities we expect to be created by the strong market fundamentals for the sector. We also look forward to exploring further potential opportunities for cooperation with HNA in areas of mutual interest.”
Subject to certain regulatory approvals and closing conditions, the transaction is likely to be completed in the second half of the year.
Following which, HG Storage will be administered by its own board of directors. It will hold rights to induct three directors to the board who will be joined by two directors appointed by Glencore.
During shareholder meetings, both Glencore and HNA representatives will be entitled to vote according to their shareholdings, subject to select reserved matters.
Additionally, the partners will have an initial lock-up period for three years in accordance with their respective stakes in HG Storage.
