Concerns that a successful takeover of APA Group by CK Group would leave a vast amount of Australia’s gas pipelines under the control of a company submissive to Chinese influence is “patently without grounds”, according to an investment advisory group.
The Australian Financial Review reported United First Partners Director Paul Cowan has dismissed suggestions a takeover by the Hong Kong-based consortium, led by CK Infrastructure (CKI), would leave gas supply at the mercy of China, saying “this is not the light switch in someone’s bathroom”.
After winning regulatory approval from the Australian Competition and Consumer Commission last week, CK Consortium’s takeover of APA must now obtain consent from the Foreign Investment Review Board (FIRB) before their $13 billion bid can proceed.
With a judgment from FIRB on the horizon before APA shareholders vote on the deal at the end of November, concerns have arisen regarding foreign ownership of the country’s gas networks, with alleged concerns within the government that CKI had close ties to China that posed risks to national security.
Mr Cowan disagreed with this sentiment, saying the company was not “under Beijing’s thumb” and pointed to CKI’s successful acquisition of DUET last year, whose electricity assets he described as more “sensitive” than APA’s pipeline portfolio.
In the event the bid for APA is successful, a significant proportion of Australia’s gas transmission assets would be foreign owned, with major APA rival Jemena 60 per cent owned by China State Grid.
FIRB is yet to set a date for their decision.