Australia has blocked Chinese and Hong Kong firms from taking a stake in electricity grid.
State Grid Corp and Cheung Kong Infrastructure Holdings were bidding for a 50.4% stake in Ausgrid, a New South Wales’s electricity distribution network.
The government said the proposals from both firms “were contrary to the national interest, in accordance with the required provision on the grounds of national security”.
It has invited the bidders to make submissions again by the 18th of August to make a final decision.
Australian Treasurer Scott Morrison said: “There has been an extensive period of engagement with the New South Wales Government and the bidders around the proposed lease. This has involved a detailed examination of national interest issues and possible measures which could mitigate identified risks.
“In particular, during the review process national security issues were identified in critical power and communications services that Ausgrid provides to businesses and governments. I am, of course, open to consider what the bidders put to me, but at this stage no suitable mitigations have been identified that would, for the proposed transaction structure, appropriately address the identified risks.”