Hong Kong billionaire Li Ka-shing announced Tuesday he will pay US$11.6 billion to merge his utilities firms in a bid to improve his vast business empire’s position for future expansion.
The 87-year-old’s latest move is the second reshuffle of his empire in a year, following the re-organisation of his flagship Cheung Kong Hutchison Holdings announced in January.
His Cheung Kong Infrastructure (CKI) said Tuesday it will offer US$11.6 billion to acquire all shares in Power Assets Holdings not already belonging to the firm.
CKI said it will offer 1.04 of its shares, valued at US$8.53 at Tuesday’s close on the Hong Kong stock market, for each of the 1.3 billion Power Assets shares.
“The stronger balance sheet and significant cash balance will enable CKI to better compete for infrastructure projects given the capital intensive nature of the infrastructure industry,” it said in a statement filed to the Hong Kong stock exchange.
“The proposal will create a world class, diversified infrastructure investment platform that is significantly enhanced in terms of size and scale,” the company said.
CKI currently operates development, investment and infrastructure businesses in mainland China, the UK, Canada and other countries.
The tycoon in January announced a sweeping reorganisation of his businesses combining assets from multiple sectors under two new companies Cheung Kong Hutchison Holdings and CK Properties.
Li’s flagship CK Hutchison controls assets in telecoms, utilities, ports and other industries in over 50 countries and reported a net profit of US$13.14 billion for the first six months of the year, the first earnings report since the reshuffle.
Li had said that overhaul was to secure stability in future, while it was also seen as paving the way for him to hand over the reins to his eldest son Victor, 51, after he retires.
During the same month, Li had also announced plans to buy UK phone giant O2 for up to US$15.4 billion.
Octogenarian Li, who is nicknamed “Superman” for his sharp business acumen, has been selling assets in China and Hong Kong and making multi-billion dollar purchases in Europe, fuelling speculation that he is losing confidence in the Greater China region.
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