Cheung Kong Infrastructure (Holdings) (CKI) and its utility arm - Hongkong Electric Holdings - will pay A$2.31 billion (about HK$10.49 billion) for Powercor Australia, an electricity distributor and retailer in Victoria state. CKI chairman Victor Li Tzar-kuoi said the investment was part of a globalisation plan in which the companies would seek investments in North America, Asia and the mainland. Powercor, the largest of five electricity distributors in Victoria, is the second power investment in Australia by CKI and its 38.9 per cent-owned Hong Kong Electric. In December, the companies purchased ETSA Utilities, a power distributor in South Australia, for A$3.25 billion. The latest purchase by a recently formed 50:50 joint venture brought the investment by the companies in Australia to HK$27 billion, Mr Li said. CKI managing director Kam Hing-lam said Powercor would be a low-risk investment with a steady return for the companies. He said the investment's return on equity was at the 'mid-teens' level. Mr Kam said funding for the acquisition would initially be provided by bank facilities guaranteed by CKI and Hongkong Electric. Refinancing would be arranged through debt or capital markets soon after the completion of the transaction, expected to be before September 15, he said. Despite the big push into Australia, Mr Kam said the mainland was still the main focus. However, analysts have said CKI will slow its investment in the mainland because foreign companies are facing growing difficulty in winning good infrastructure projects. CKI has invested HK$10 billion in the mainland, compared with HK$14 billion in Australia. Alice Hui Suk-fong, head of Asian utilities research at Prudential-Bache, said: 'I think it is a fair deal which CKI and HKE can benefit from in the long term.' Ms Hui said Powercor would bring positive returns for CKI and Hongkong Electric even though the profit contribution was not expected to be significant. At the end of last year, Powercor's distribution network supplied about 8,600 GWh of electricity to more than 570,000 customer sites. The company's retail arm is Victoria's largest electricity retail business, Mr Kam said. Analysts said they expected CKI and Hongkong Electric to dispose of the retail business and concentrate the company's resources in the power distribution network. CKI rose 5.56 per cent to finish at HK$13.30 yesterday, while Hongkong Electric was unchanged at HK$24.10.