State-owned China Southern Power Grid has acquired a 25.48% stake in the Luxembourg utility company Encevo S.A., following its acquisition of a 27.8% stake in Chile’s largest transmission enterprise in March, The Paper reported.

Private equity firm Ardian said it had agreed to sell its 25.48% stake in Encevo to China Southern Power Grid.

Encevo currently operates more than 10,150 km of transmission lines and more than 3,700 km of gas pipelines in Europe. It operates in several energy sectors through two subsidiaries, Creos and Enovos Luxembourg.

Among them, Creos focuses on operating the grid and natural gas networks. Enovos Luxembourg is responsible for selling energy to customers in Luxembourg and Germany.

The two parties did not disclose the transaction price. However, it is reported that the deal was valued at about 400 million euros.

For Chinese grid companies, the attractiveness of companies like Encevo is obvious. Such companies are believed to be able to generate stable returns, because most of their income and profit are regulated and guaranteed by local governments.