Hong Kong billionaire Li Ka-shing's CKI tables $5.4 bn bid for Australia's Duet Group

Hong Kong billionaire Li Ka-shing's Cheung Kong Infrastructure Holdings Ltd (CKI) has tabled a A$7.3-billion ($5.4 billion) cash bid for Australian pipeline operator and power distributor Duet Group.

Sydney-based Duet today said that CKI has offered A$3 a share, and the company's board is evaluating the non-binding and conditional offer.

The move comes three months after the Australian government rejected a A$10 billion bid by CKI for a controlling stake of state-owned energy grid Ausgrid, citing security concerns. (See: Australian government blocks Chinese investment in electricity network)

Chinese state-owned State Grid Corporation and Hong Kong-based CKI had been in the race for a 99-year lease for the 50.4-per cent stake in Sydney electricity grid Ausgrid, in a deal where the Australian government would have netted around $10 billion.

Some analysts opine that if Ausgrid was in control of the Chinese, it could be vulnerable to cyberattacks from hackers from Russia, who had in December hacked the Ukraine electricity grid.

Duet's assets include the Dampier Bunbury natural-gas pipeline, which connects gas reserves on Western Australia state's offshore North West Shelf and gas and electricity distribution networks in the southeast around Melbourne.

CKI owns stakes in Australian assets including SA Power Networks, Powercor Australia and Australian Gas Networks.

The Duet deal would be Li's biggest acquisition in the nation, according to data compiled by Bloomberg.

CKI has diversified investments in energy, transportation, water infrastructure, waste management, waste-to-energy and infrastructure related businesses.

Its investments and operations span Hong Kong, mainland China, the UK, the Netherlands, Portugal, Australia, New Zealand and Canada.