CHINA Guodian Corp will increase its stake in publicly traded unit GD Power Development Co for 3.07 billion yuan (US$405 million) as part of a government plan to separate ownership of power plants from grid networks.

China Guodian, one of the nation's five biggest power generators, will raise its stake to 61.82 percent from 37.58 percent, GD Power said in a statement to the Shanghai Stock Exchange yesterday. The parent company will buy the stake from Liaoning Electric Power Co, a unit of State Grid Corp of China, the bigger of the country's two electricity distributors.

The share sale by Liaoning Electric forms part of the 9,200 megawatts of state-owned power capacity that was auctioned by the government, Bloomberg News reported. China wants to separate the control of power plants from the network carrying the electricity to bring the nation nearer to global practices and improve the stability of supply.