China’s Communist Party anti-corruption watchdog has launched an investigation over the insider trading case linked to China National Offshore Oil Corp's (CNOOC) bid fo Nexen– a Canadian-based oil sands company, reports Caixin online.
In July, China's third-largest state owned oil company announced a $15.1 billion takeover of Nexen (TSX & NYSE:NXY), the biggest ever foreign investment in the North American country.
A few days later, Zhang Zhirong, chairman of China's largest private shipbuilder, Rongsheng Heavy Industries Group Holdings, was suspected of making more than $13 million on the New York stock market through insider trading linked to the CNOOC-Nexen deal, says the Caixin article.
The U.S. Securities and Exchange Commission (SEC) is already investigating the issue and, according to the newspaper, the Central Commission for Discipline Inspection of China is doing the same.
Studies show Canadians are still uncertain about the Nexen-CNOOC deal.
A recent release from Canada's New Democratic Party (NDP) opposed to the bid, quoting a study from Abacus Data which says that nearly 60% of locals are against it. But what the NDP did not mention was that about the same 60% of Canadians interviewed were unaware of the bid.
To date Chinese owned companies have invested over $15 billion in Albertan oil sands developments and roughly 70% of all oil sands production is owned by out of Canada shareholders.