HONG KONG, Oct. 15 /CNW/ - Cheung Kong Infrastructure Holdings Limited
("CKI" or the "Group"), a publicly-listed company on the Stock Exchange of
Hong Kong (HK:1038), has signed a Support Agreement with TransAlta Power, L.P.
("TransAlta Power"), an energy company listed on the Toronto Stock Exchange
(TSX: TPW.UN). Under the agreement, CKI will make an offer to acquire all of
the issued and outstanding trust units of TransAlta Power for a cash
consideration of HK$65.95 (C$8.38) per unit by way of a take-over bid. The
transaction is valued at approximately HK$4,950 million (C$629 million).
Under the Support Agreement, TransAlta Power would send out a director's
circular to TransAlta Power unitholders stating the unanimous recommendation
of the board of directors for acceptance of the offer.
A take-over bid circular, containing the full terms of the offer, is
expected to be mailed to TransAlta Power unitholders together with the board
of directors' circular and other related documents by the end of October.
The offer is subject to acceptance by at least 66 2/3 of unitholders. The
acquisition is expected to be completed by early 2008 after the receipt of the
necessary regulatory approvals and acceptance by unitholders.
TransAlta Power owns a 49.99% interest in TransAlta Cogeneration, L.P.
("TransAlta Cogeneration") which has stakes in six Canadian generating plants.
They include five natural-gas powered cogeneration units in Alberta,
Saskatchewan and Ontario, and a coal-fired generation plant in Alberta. The
plants have a total generating capacity of 1,362 MW of electric power.
Mr H L Kam, Group Managing Director of the Group, commented: "The
proposed acquisition will provide immediate cashflow stream and profit
contribution. As a long-term investor, we expect TransAlta Power to generate
steady returns for the Group over the years."
"This is CKI's second initiative in recent months to expand its
electricity generation portfolio. With the proposed 2,000 MW new power plant
units in Zhuhai announced recently, together with TransAlta Power's
electricity assets, the total installed capacity would then be increased to
over 10,000 MW. Our electricity generation investments would then span across
Hong Kong, Mainland China and Canada," Mr Kam said.
"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 across Hong
Kong, Mainland China, the United Kingdom and Australia, and we look forward to
further expanding into North America," Mr Kam continued.
The Cheung Kong Group, of which CKI is a member, is one of the largest
foreign investors in Canada, with a portfolio that includes a 34.6% interest
in Husky Energy Inc. ("Husky"). The power plant in Saskatchewan is jointly
owned, 50/50, by TransAlta Cogeneration and Husky. In addition, Husky also
supplies gas to TransAlta Cogeneration's gas-fired cogeneration plant in
"Through the proposed acquisition of TransAlta Power, CKI will further
strengthen the Cheung Kong Group's presence in Canada," Mr Kam commented.
"CKI has cash on 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 Mr Kam.
TD Securities Inc. is acting as exclusive financial advisor and Stikeman
Elliott LLP is acting as legal counsel to CKI.
CKI is the largest publicly listed infrastructure company in Hong Kong
with diversified investments in Energy Infrastructure, Transportation
Infrastructure, Water Infrastructure and Infrastructure Related Business.
Operating in Hong Kong, Mainland China, Australia, the United Kingdom, Canada
and the Philippines, it is a leading player in the global infrastructure
About TransAlta Power
TransAlta Power, L.P. owns a 49.99% interest in TransAlta Cogeneration,
L.P., which owns interests in five gas-fired cogeneration facilities in
Ontario, Alberta and Saskatchewan and in a coal-fired, mine-mouth facility in
Alberta. These facilities have a total generating capacity of 1,362 MW of
electric power, all of which is sold under long-term contracts to high-quality
For further information:
For further information: Mrs Wendy Tong Barnes or Miss Natalie Palmer of
CKI at (852) 7220 1315