The Cheung Kong Group, run by Asia’ richest man Li Ka-shing, has agreed to a takeover of Australian natural gas distribution company Envestra Ltd. (ENV) in an all cash deal that values Envestra at US$2.2 billion, according to an announcement by ENV.
Cheung Kong, which already owns 17.46% of ENV, is to offer A$1.32 per share, in addition to a dividend of as much as A$3.5 cents per share.
The deal compares with a previous takeover offer from Australia’s largest natural gas infrastructure company APA Group, which offered A$1.34 per share based on ENV’s closing price today.
Envestra’s independent directors have recommended the proposed transactions by Cheung Kong to shareholders, but the deal is still pending numerous conditions including obtaining approval from Australia’s Foreign Investment Review Board.
The deal will be financed through existing cash reserves and credit available to Cheung Kong, according to the release.
In 2012, A consortium led by Cheung Kong acquired U.K.’s gas distribution firm Wales & West Utilities Ltd. for US$1.1 billion.