UPDATE 1-CKI says interested in EDF's UK power asset

HONG KONG, Nov 16 (Reuters) - Cheung Kong Infrastructure (CKI) said on Monday it was interested in bidding for Britain's biggest electricity distribution network, which was being sold by French utility EDF. "We have a gas network in the UK and the regulatory environment in gas is similar to power. So if we buy the power network, it will create synergies," H.

L. Kam, CKI's group managing director, told reporters. Kam said CKI, which has more than HK$10 billion ($1.29 billion) in cash on hand, was actively studying a bid for the asset, expected to come to the market in early 2010. EDF has sent a teaser out to potential bidders for its three distribution network operators (DNOs) whose regulated asset value (RAV) now stands close to 4 billion pounds ($6.7 billion), several sources familiar with the process told Reuters earlier this month. CKI and its unit Hongkong Electric said earlier on Monday that they would spend 76 million pounds ($127 million) to increase their stakes in British gas distributor Northern Gas Networks. They would buy the stakes from United Utilities Group, the companies said in a statement to the Hong Kong Stock Exchange. "There are a number of opportunities that have arisen, like the NGN one, with secure income and attractive double-digit returns," Kam said. "We are looking at more than 10 projects mainly in the UK, Australia, North America and Asia with some of them as large as tens of billions of Hong Kong dollars," he added. After the purchase, CKI, a roads and utility investment company controlled by billionaire Li Ka-shing, will see its stake in Northern Gas Networks rise to 47.06 percent, from 40 percent. Hongkong Electric's stake will rise to 41.29 percent from 35.1 percent. CKI has invested in gas, water and road assets in Australia, Canada and the United Kingdom. The company's share price has been steady so far this year, underperforming the benchmark Hang Seng Index, which has risen nearly 60 percent. ($1=.5986 Pound=HK$7.749) (Reporting by Alison Leung and Joanne Chiu; Editing by Jacqueline Wong) (([e-mail]; [phone]; Reuters Messaging: [e-mail])) Keywords: CKI/ (If you have a query or comment on this story, send an email to [e-mail]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

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