SYDNEY (Reuters) - The head of Australia’s foreign investment review board said a decision to block the A$10 billion ($7.7 billion) sale of the country’s biggest energy grid to Chinese bidders was based on new information and not politically motivated.
In a series of interviews with local media published on Tuesday, review board chairman Brian Wilson defended the agency's handling of the proposed sale of Ausgrid to the short-listed bidders, State Grid Corp of China [STGRD.UL] and Hong Kong's Cheung Kong Infrastructure Holdings 1038.HK.
Treasurer Scott Morrison announced last week that the government would veto the sale to those companies based on national interest grounds.
Wilson said the board had not “changed its mind” on the suitability of the bidders after it greenlighted the short list a few months ago.
“It is not about the board changing its mind, it is a case of responding to new information,” he told The Australian newspaper. “This is not a politically influenced decision. It is a result of a confluence of events.”
The sale of Ausgrid was expected to fetch a record sum for an Australian privatization.
Wilson told the Australian Financial Review newspaper that he felt obliged to speak publicly, a rare occurrence for the FIRB chair, to correct the record.
A “genuine national security issue” became apparent as detailed work was done by the agency, he told the newspaper, without specifying the concern.
“The proposed structure is contrary to the national security interest because it leaves a material national security vulnerability,” Wilson said. “Almost by definition it is not a security issue you can disclose.”
Reporting by Cecile Lefort, editing by Jane Wardell and Richard Pullin
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