China Huaneng said to be closing in on InterGen

China Huaneng Group (subsidiary: Huaneng Power International, HNP.NYSE, 600011.SH, 0902.HK) is in talks to buy 50% of InterGen NV for about US$1.2 billion, Bloomberg reported, citing two people familiar with the situation. The Chinese firm is negotiating with Indian’s GMR Infrastructure, which bought the stake from a fund owned by American International Group in 2008 for US$1.1 billion. The remainder of InterGen is owned by Ontario Teachers’ Pension Plan. The deal may be valued at as much as US$1.4 billion, including payments for taking over some non-operating assets. If the deal goes through, it would give China Huaneng, which produces more than 10% of China’s electricity, access to InterGen’s 12 power plants in the UK, the Netherlands, Mexico, Australia and the Philippines. It would also be the Chinese firm’s largest investment since it bought Singapore’s Tuas Power for US$3.1 billion.