CANBERRA, Australia—Australia’s government moved to block State Grid Corp. of China and Hong Kong’s Cheung Kong Infrastructure Holdings Ltd. 1038 -0.14 % from taking a controlling stake in the country’s largest electricity network, bowing to worries over national security.
Treasurer Scott Morrison said he had given State Grid Corp. and Cheung Kong Infrastructure one week to respond to concerns around bids to take a 50.4% stake in Ausgrid following a process that left some federal lawmakers concerned that the deal, worth more than 10 billion Australian dollars (US$ 7.7 billion), could threaten vital infrastructure.
“Ausgrid’s footprint includes critical power and communications services that Ausgrid provides to businesses and government,” Mr. Morrison told reporters. “The national security concerns are not country specific and relate to the transaction structure and the nature of the assets,” he said.
Ausgrid, with almost 1.7 million customers and assets worth A$ 15.3 billion, has attracted foreign interest because it is seen as offering stable, regulated returns from a network the size of New Jersey, stretching from Sydney to fast-growing coastal regions north of Australia’s largest city.
Write to Rob Taylor at [email protected]