Hong Kong’s Cheung Kong Infrastructure Holdings Limited (CKI) has agreed the purchase of TransAlta Power L.P., giving it a stake in six generating plants in Canada. The C$629 million deal is part of CKI’s plans to expand its generating portfolio, and fulfils its ambition of a foothold in the North American electricity market.
TransAlta Power owns a 49.99 per cent interest in TransAlta Cogeneration, which has stakes in five natural gas fired cogeneration plants and one coal-fired power plant in Alberta, Saskatchewan and Ontario. The plants have a total generating capacity of 1362 MWe.
“This is CKI’s second initiative in recent months to expand its electricity generation portfolio,” said Mr H. L. Kam, Group Managing Director of CKI. “CKI has always been very interested in expanding our presence into North America. The proposed acquisition of TransAlta Power is a springboard for CKI into the Canadian energy market. Our energy portfolio now spans Hong Kong, mainland China, the United Kingdom and Australia, and we look forward to further expansion into North America.”
TransAlta Power’s board of directors has agreed to the takeover by CKI following a strategic review of its business.
The acquisition will consolidate the position of CKI’s parent company, Cheung Kong Group, in Canada. Cheung Kong is one of the largest foreign investors in Canada and owns a 34.6 per cent interest in Husky Energy, which together with TransAlta Cogeneration owns the natural gas-fired power plant in Saskatchewan. In addition, Husky also supplies gas to TransAlta Cogeneration’s gas-fired cogeneration plant in Mississauga, Ontario.
“CKI has cash in hand of nearly HK$9 billion at present. In view of the liquidity situation in the global markets and the affordability to compete for mega-infrastructure projects, CKI remains in an excellent position to pursue good acquisition opportunities,” concluded Kam.