BEIJING Enterprises Holdings Ltd said it will pay HK$8.22 billion (US$1.1 billion) to its parent for a 22.01 percent stake in city gas distributor, China Gas Holdings Ltd.

As part of the deal, Beijing Enterprises Holdings, a conglomerate with businesses from brewery to sewage and water treatment, will pay HK$2 billion in cash and issue 113 million new shares at HK$55 apiece to its parent, according to a filing to the Hong Kong stock exchange yesterday.

Beijing Enterprises Holdings will become the biggest shareholder of China Gas upon completion of the transaction.

The parent company, Beijing Enterprises Group, last year increased its stake in China Gas after ENN Energy Holdings, another city gas distributor, and Sinopec Corp, China's second-largest oil company, made a hostile offer for China Gas but their bid failed.