CKI and HK Electric under credit watch

The ratings of Cheung Kong Infrastructure Holdings and Hongkong Electric Holdings were placed on credit watch yesterday after an offer to buy Electricite de France's power networks in Britain for GBP5.78 billion (HK$70.9 billion). Standard & Poor's Rating Services put the firms' stable 'A-minus' long-term rating on credit watch because 'the proposed acquisition will likely materially weaken' their balance sheet and liquidity. The two firms last week joined the Li Ka Shing Foundation in a consortium to take over the electricity networks.