Standard & Poor's Upgrade CitiPower's Rating To A- After CKI And Hongkong Electric Complete Acquistion
30 August, 2002 -- Hong Kong
Cheung Kong Infrastructure Holdings Limited (CKI) and Hongkong Electric Holdings Limited (HEH) today successfully completed the acquisition of CitiPower I Pty Ltd (CitiPower), taking over the company's operation.
Meanwhile, Standard & Poor's (S&P) upgraded CitiPower's credit rating to A- from BBB+. Officiating at the transaction in Australia, Mr. H. L. Kam, Group Managing Director of CKI, and Mr. K. S. Tso, Group Managing Director of HEH, said, "We are very pleased with Standard & Poor's decision to raise CitiPower's rating. The move not only reflects the quality of CitiPower itself, but also signifies investor confidence in CKI/HEH's Australia infrastructure businesses.We believe CitiPower's performance will match that of our other existing investments in Australia, and will immediately produce steady and attractive returns."
The net consideration is A$1.418 billion, of which A$400 million in loan notes due 2007 will be assumed by CitiPower. The remaining amount of about A$1 billion will initially be settled by shareholder equity and bank borrowings, and will be refinanced at the project level via the domestic capital markets in Australia.
CitiPower distributes approximately 5,300 GWh of electricity to around 265,000 customers in the central business district and inner suburban areas in Melbourne, Victoria. Together with the earlier acquisitions of Powercor Australia in Victoria and ETSA Utilities, the sole electricity distributor in South Australia, the three companies together make CKI/HEH the biggest electricity distributor in Australia in terms of customers, serving a total of 1.6 million customers.