China fund buys nearly 1 percent of BP

China fund buys nearly 1 percent of BP
Reuters - 35 minutes ago

BEIJING (Reuters) - A Chinese sovereign fund has accumulated a stake of just under 1 percent in BP , Britain's largest company, the Daily Telegraph reported.

The paper quoted a spokesman for the oil major as saying it is aware of the Chinese stake, which is worth about $2 billion (1 billion pounds), and welcomes all shareholders.

The paper said the same Chinese state investor had built up a stake in French oil giant Total .

That fund is the State Administration of Foreign Exchange, an arm of the central bank that manages China's $1.68 trillion in foreign exchange reserves, the Financial Times reported last week.

The disclosure of China's stake coincides with a visit to Beijing by Chancellor of the Exchequer Alistair Darling, who has said sovereign funds are welcome in Britain as long as their investments are commercially, not politically, driven.

Darling is due to meet Premier Wen Jiabao on Tuesday as well as Lou Jiwei, head of China Investment Corp, a $200 billion sovereign wealth fund that Beijing set up last September to diversify the investment of its reserves.

The Daily Telegraph said Prime Minister Gordon Brown's office was aware of China's stakeholding in BP and was monitoring the situation.