PARIS -- Portuguese utility EDP said Tuesday that it has rejected a takeover bid of about 9.1 billion euros ($10.7 billion) from China Three Gorges, the power and gas company's biggest shareholder.
"The executive board of directors considers that the price offered does not adequately reflect the value of EDP," the statement said.
Three Gorges, which takes its name from a huge dam in central China that the company operates, is trying to step up its overseas expansion by buying EDP, which also operates in the U.S., Spain and Brazil.
Three Gorges, which has a 23% stake in EDP, on May 11 launched a takeover bid valuing the company at 3.26 euros per share, a premium of nearly 5% over EDP's closing price on the same day. The Chinese state-owned company wants to buy a majority stake, including its current shareholdings.
The Portuguese government has denied intervening to halt the proposed takeover, but seems concerned about a foreign company taking control of part of the country's basic infrastructure.
Three Gorges' May 11 takeover bid has pushed up EDP shares to around 3.40 euros, above the Chinese company's offer price.
Portugal has privatized a number of state-owned companies since the European debt crisis erupted in 2010. EDP, a state-owned company at the time, was privatized and accepted investment from Three Gorges.