CLP, Hong Kong’s largest utility company has become the preferred bidder in a $1.58 billion bidding war for the TXU Australian merchant energy business that is being sold off by Singapore Power.

CLP already has significant generation in Australia and will now add more than a million Victorian gas and electricity customers to its portfolio after Australia’s Alinta and an International Power-backed bid dropped out.

Singapore Power, which paid around $4 billion for the overall TXU business almost a year ago, will hold its gas and electricity transmission networks but get rid of the generation, including the 1,200 MW gas-fired Torrens Island plant, retail operations and a gas pipeline linking South Australia and Victoria.