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December 6, 2016

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Home » Business » Energy

Li in US$5.4b bid for Aussie energy group

Source: AFP | December 6, 2016, Tuesday | Print Edition

LI Ka-shing’s Cheung Kong Infrastructure yesterday offered A$7.3 billion (US$5.4 billion) for an Australian energy group, just months after his bid for the country’s largest electricity network was blocked on security grounds.

The Hong Kong billionaire’s unsolicited and conditional A$3 per share offer for the Duet Group, an energy utility asset owner, represented a near 28 percent premium on its closing share price on Friday.

“The boards of the Duet Group are currently evaluating the proposal and at this time securities holders are advised to take no action as there is currently no certainty the proposal will proceed further,” the target company said in a statement.

The Australian newspaper said China’s State Grid and Singapore Power were believed to be working on a counter offer for Duet, which if true could spark a bidding war.

Duet owns electricity and gas networks in Victoria state as well as Western Australia’s main gas transmission line.

The bid is Li’s latest attempt this year to bolster his Australian business after suffering a blow when a proposal to buy the country’s largest electricity network, AusGrid, was halted by the federal government in August.

Canberra rejected the move on national security grounds after introducing tougher rules for the sale of major Australian state-owned infrastructure to private foreign investors.

China’s State Grid Corp was also rejected, with reports at the time suggesting Canberra was concerned about Li’s links to senior government officials in China.

Analysts believe approval for the new deal from the Foreign Investment Review Board could again prove troublesome amid heightened public debate about strategic assets falling into overseas hands.

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