China's state grid is 'very disappointed' by Ausgrid rejection

[HONG KONG] State Grid Corp of China, the world's biggest utility, "deeply regrets" Australia's decision to stop the company from buying a majority stake in the state-owned power network Ausgrid.

State Grid agreed to participate in the bidding after an invitation from the New South Wales government in November, it said in an e-mailed statement late Friday. The company has "absolutely" followed the guidance and conditions set by the seller through to submission of the final paperwork, it said.

"We find it hard to understand and are very disappointed" that bidders were rejected on the pretext of national security at a very late stage, the state-owned company said. It didn't say whether it would submit a new proposal.

Australia's Treasurer Scott Morrison confirmed Friday he'll block foreigners from buying a majority stake, saying the deal worth more than A$10 billion (S$10 billion) was against the national interest.

Only State Grid and Hong Kong billionaire Li Ka-shing's Cheung Kong Infrastructure Holdings made binding bids for a 50.4 per cent stake, people familiar with the matter have said.

Chinese Commerce Ministry spokesman Sun Jiwen said Friday the decision would "severely" reduce the appetite of companies to invest in Australia and hurt bilateral trade ties.

BLOOMBERG