April 22 (Reuters) - U.S. energy major Exxon Mobil XOM.N is in talks to sell its Hong Kong fuel stations in a deal that could fetch a few hundred million dollars, said three people with knowledge of the matter.
The company has hired a financial adviser and held discussions with a handful of bidders, the sources said on condition of anonymity because the information was confidential.
Four to five bidders are involved, including a few trading houses, they said without disclosing any of the suitors.
The planned sale was first reported on Wednesday by Bloomberg. Exxon could value the assets between $500 million and $600 million, the report said, citing unnamed sources.
Exxon did not respond immediately to a request for comment.
The potential deal would represent another shift in Hong Kong’s fuel retail market after Thailand’s Bangchak Corp BCP.BK agreed in February to buy Chevron’s CVX.N Hong Kong fuel business for $270 million, including 31 service stations as well as its industrial and marine fuels operations.
The deal activity comes against a backdrop of Hong Kong’s push towards transport electrification and oil price volatility driven by the Iran war.
Given Exxon’s size and market share in Hong Kong, the deal is expected to fetch a much higher number than the Chevron sale, one of the sources said.
Exxon provides a variety of products and services to customers in Hong Kong through an extensive network of service stations operating under the Esso brand. Its first Hong Kong service station opened in Kowloon in 1926. The company now sells fuel in Hong Kong through a network of about 41 Esso-branded service stations.
The company warned this month that first-quarter earnings could fall from the previous quarter after a multibillion-dollar hit from hedging and accounting effects outweighed higher oil and gas prices.
Rival Chevron similarly said stronger upstream earnings from higher crude prices would be offset partly by timing effects tied to hedging.
The Middle East conflict has disrupted flows through the Strait of Hormuz, a key route for global oil shipments, driving sharp price swings and adding uncertainty to valuations for fuel-related assets.
(Reporting by Yantoultra Ngui and Trixie Yap in Singapore and Kane Wu in Hong KongAdditional reporting by Vallari Srivastava in Bengaluru and Chen Aizhu in SingaporeEditing by Shailesh Kuber, Louise Heavens and David Goodman)
