Cheung Kong Infrastructure (Holdings) (CKI) has begun talks to take over mainland toll-road operator Road King Infrastructure. Hong Kong-based Road King is 49.9 per cent-owned by locally-listed construction company Wai Kee Holdings. However, it is unclear whether CKI - a subsidiary of Hutchison Whampoa - plans to acquire a controlling stake in Road King or buy out the lot. A CKI official said a due diligence was under way, but declined to unveil the pricing on the proposed purchase. She also declined to comment on whether the listing status of Road King would be maintained in the wake of any takeover of the company, which was spun off from Wai Kee in 1996. It has road network projects in mainland provinces including Guangxi, Shanxi and Hunan. Based on last Fridays' closing price the market capitalisation of Road King was about HK$1.86 billion. British-listed Stagecoach has 22.97 per cent while AIG Infrastructure Fund owns 6 per cent. 'I do not think it is a very attractive deal, unless CKI will get it [Road King] at a very cheap price,' an analyst said. 'CKI has been selling its infrastructure projects which relied on guaranteed returns, I do not understand why they would buy Road King, whose road projects mostly depended on income guarantees.' As with other overseas companies, CKI has been disposing of investments or trimming holdings in projects with income guarantees after Beijing frowned on the practice. Last year, CKI cut its stake in the Shenyang road network to 30 per cent from 50 per cent in return for cash compensation and an increased share of distributable income. It was also negotiating to pull out of the Nanhai road project on payment of its investment principal and accrued return. Road King closed at HK$3.65 before it was suspended from trading yesterday. That was about 50 per cent discount to its book value of HK$7.50 per share. However, analysts said it was not very attractive in view of its slow earnings. Wai Kee owns construction unit Zen Pacific, which is involved in a Sha Tin public housing piling incident.