China’s ORG has escalated a bidding war for control of CPMC Holdings, seeking to undermine a deal that would see the fellow canmaker taken over by Baosteel’s canmaking business, Shanghai Baosteel Packaging.

Beijing-based ORG has revived an acquisition plan that had been put on hold and made a counteroffer that would value the maker of aluminium and steel cans at HK$8 billion (US$1bn), about HK$350 million more than the pitch made by Baosteel. The cost to ORG would be around HK$6bn because it already owns almost a quarter of CPMC.

If successful, ORG’s bid would end Baosteel’s hopes of creating China’s largest canmaker and instead solidify its own position as the nation’s biggest can producer, creating a company that would control some 22 plants in China.

Nevertheless, while Baosteel has the blessing of China’s powerful state-owned Assets Supervision and Administration Commission (SASAC) – which oversees national industrial policy and owns about a fifth of CPMC – it’s not known if the same approval has been given to ORG.

CPMC has become the focus of acquisition bids after a string of muted quarterly earnings performances. Sales have been flat for some time as it tackles the impact of a weakening Chinese economy.

ORG, which has 11 plants in China and is jointly developing an aluminium beverage can plant in Hungary with CPMC shareholder COFCO, had indicated its interest in bidding earlier this year. But after Baosteel made the first offer when its proposal was approved by SASAC, ORG appeared to have withdrawn from the plan.

CPMC operates 11 beverage can and end-making plants in China and counts Anheuser-Busch InBev, Coca-Cola and CR Snow Breweries among its customers. It also controls Benepack in Europe, a joint-venture company that operates a two-line aluminium beverage can plant in Belgium.

The proposed new deal would pay CPMC shareholders, including general manager Zhang Ye and executive director Qu Hongliang, HK$7.21 per share – a 4.9% premium over that offered by Champion Holding, a special vehicle set up by Baosteel to buy CPMC. It is also about 13% more than the stock’s closing price on the Hong Kong Stock Exchange before the announcement was made this week. Zhang and Qu own about 1% of total holdings.

ORG yearly produces an estimated 15 billion aluminium cans as well as 9 billion three-piece tinplate food, beverage and general line cans.

Shanghai Baosteel Packaging operates 10 beverage can and end-making plants: in Shanghai, Hebei, Wuhan, Chengdu, Foshan, Henan, Guizhou and Harbin. It also opened a plant in Cambodia in 2022.

In its bid documents, the canmaker estimated that its combined operations with CPMC would have yearly sales of about $2.5 billion after doubling the number of plants it runs. In its most recent quarterly financial report, for January-March, the company reported sales of about $276m. The revived bid is being made through ORG’s holding company Haurui Fengquan Development