Australian energy group backs Li Ka-shing takeover

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SYDNEY: Li Ka-shing’s Cheung Kong Infrastructure on Monday moved a step closer to a more than Aus$7 billion ($5.2 billion) takeover of Australian energy group Duet after a recommendation from the energy group’s board.

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In December, the Hong Kong billionaire put in an unsolicited and conditional offer of $Aus3 per share for Duet.

Following a review of the offer, the Duet board said it had agreed to recommend the takeover at a revised offer of $3.03.

“The total cash proceeds of $3.03 per stapled security, inclusive of a special distribution payment by Duet, fully recognise the value and future growth platform that our management team has created and the operating and financing synergies available to the Consortium.” Duet chairman Doug Halley said in a statement to the Australian Stock Exchange.

Duet owns the primary gas transmission line in the state of Western Australia and has electricity and gas lines in Victoria.

Shareholders will vote on the deal in April.

Li’s takeover bid will also need approval from the federal government, which last year blocked his efforts to buy Australia’s largest electricity network, AusGrid.

The move was halted by Canberra on national security grounds after parliament introduced tougher rules for the foreign sale of Australian state-owned infrastructure.

Hong Kong-listed Cheung Kong is a global player in infrastructure with operations in China, Britain, Canada, the Netherlands, New Zealand and Portugal.

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