* First payment tranche made before deal stalled -sources
* Acquisition seen as sign of growing
* Deal stalled due to investigation into CEFC boss -sources
By Dmitry Zhdannikov
The fate of the deal, one of the largest Chinese investmentsin
The acquisition of the stake in Russian state oil firm isseen as strengthening relations between
CEFC China Energy was buying the 14.16 stake from aconsortium including Swiss trader Glencore. It hadtransferred the first tranche of payment before it ceased allcommunications, the sources told Reuters.
The sources declined to say how much had been paid. One saidthe fact some money has changed hands would make it moredifficult for any party to back out of the deal.
CEFC founder and chairman Ye was put under investigation byChinese authorities over suspected economic crimes, Reutersreported at the beginning of March, and he will step down fromhis position at the firm.
Rosneft representatives have since travelled to
"The other party (CEFC) has just vanished," one source said.
Rosneft and Glencore declined to comment, while CEFC did notrespond to a Reuters request for comment.
Another of the sources said it was difficult to predict howthe deal would unfold. "One thing is clear though. The Kremlinwants
The Chinese foreign ministry and the Chinese nationaldevelopment and reform commission, a state economic managementagency, did not immediately respond to requests for comment. TheKremlin declined to comment.
RAPID GROWTH
The investigation into Ye, who founded CEFC in 2002,followed mounting concerns among Chinese authorities about thefinances and opaque ownership of the
An investment firm owned by the
State-controlled China Huarong Asset Management Co has takena 36.2-percent stake in CEFC Hainan International, the unit thatis acquiring the Rosneft stake.
Complications to the deal could prove a blow for Rosneftboss Igor Sechin, a close ally of Russian President VladimirPutin. Sechin is keen to attract new foreign investment as a wayof showing the Kremlin oil producer is not crumbling under thepressure of Western sanctions but is growing.
In 2016, Sechin clinched a deal with Glencore and
Less than nine months later, CEFC agreed to buy out themajority of the stake with QIA keeping its stake intact ataround 5 percent, equal to its initial contribution.
(Additional reporting by Vladimir Soldatkin and Aizhu Chen;Writing by Dmitry Zhdannikov; Editing by Pravin Char)