Hong Kong’s CK Infrastructure Proposes a $13B Takeover Deal to APA

Hong Kong-based investment and energy giant CK Infrastructure has proposed a $13 billion takeover deal to Australia’s largest gas network operator APA Group.

In a release to the ASX on Wednesday morning, APA said it received a non-binding proposal of $11 a share from a consortium led by CKI, which is controlled by Asian billionaire and Cheung Kong Holdings chairman Li Ka-shing.

“Based on the the indicative price of $11 cash per stapled security, the APA board considered it in the best interests of APA’s security holders to engage further with the consortium,” said APA.

Last year, the Cheung Kong group acquired energy utility assets group DUET in a $7.4 billion deal. It also tried to buy NSW energy distributor Ausgrid in a joint bid with China’s State Grid Corporation, but was rejected by federal treasurer Scott Morrison, who at the time cited national security concerns.

Any acquisition would need to be approved by the Foreign Investment Review Board. The consortium has been in discussions with the Board as well as competition watchdog ACCC.

“The APA Board will continue to evaluate the proposal and will update APA’s security holders and the market as appropriate,” said APA Group Chairman Michael Fraser.