Monday’s stock market crash appeared…
The hottest oil countries in…
The richest man in Hong Kong, billionaire Li Ka-shing, has placed a bid for the gas distribution network of UK’s National Grid. The utility is selling a 51-percent stake in its gas distribution business to focus on its local power business and U.S. operations, which have a better growth potential.
The majority stake in National Grid’s four gas distribution pipelines is estimated at around US$7.8 billion (GBP 6 bln). At that valuation, the entire network is worth some US$14.3 billion (GBP 11 bln). The network supplies fuel to 11 million household and business clients in the Midlands, Northwestern Britain and parts of London.
Ka-shing already has a solid presence in Europe and the UK in particular: he owns the port of Harwich, utility Northumbrian Water, and telecoms company Three. He is also a big shareholder in Canada’s Husky Energy, which this year cost him quite a lot as the company’s stock shed about half of its value. In the bid for National Grid’s network, Ka-shing will be up against bidders from mainland China, a U.S. private equity firm, and a German investment company.
The news of Li Ka-shing’s bid comes soon after British PM Theresa May pledged to limit foreign ownership of key British infrastructure. The pledge was made after the approval of the controversial Hinkley Point nuclear power plant, where Chinese investors have a stake. This raised the hackles of China skeptics who believe that companies from the Communist state are not the best co-owners of a nuclear power plant.
The Financial Times, in a not-so-subtly ironic analysis of anti-Chinese sentiments in Britain, suggests that if there should be any protectionism of local ownership over key infrastructure, then it might be fairer if it targets all foreign investors, not just the Chinese. Still, the flagman of British business journalism warns that there is a very real threat to foreign investors eyeing stakes in British infrastructure projects.
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com:
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.