Energy utility assets group Duet has accepted a $7.37 billion takeover offer from a consortium led by Hong Kong billionaire Li Ka-shing’s Cheung Kong Infrastructure Holdings (CKI)
Duet’s shares were up 5% to $2.925 after the $3.03 a share bid by a consortium of related companies — Cheung Kong Property Holdings, CK Hutchison Holdings and Power Asset Holdings.
The takeover, with an increased offer from $3 cash a share offer made in December, is subject to approval by the Foreign Investment Review Board.
Duet holds energy utility assets valued at $11.1 billion, including the Dampier to Bunbury gas pipeline in Western Australia, United Energy in Victoria and projects in the US and UK.
In 2016, it reported underlying profit of $195.2 million, and increase of 150%. Total revenue was up 3% to $1.36 billion.
Duet has appointed KPMG Corporate Finance as an independent expert to prepare a report on whether the offer is fair and reasonable.
Cheung Kong Infrastructure Holdings, which owns power grids in South Australia and Victoria, is the same group which tired to buy NSW energy infrastructure body Ausgrid but was rejected by treasurer Scott Morrison on national security grounds/a>.
Experts warned that giving foreign government-backed companies control over grid assets could present a national security risk. The grid could potentially be hacked and shut down by agents with access.
Ausgrid eventually went to an all-Australian consortium of super funds, IFM Investors and AustralianSuper with the state of New South Wales getting $16.189 billion for a partial lease of the power network.