Chinese tycoon in $14bn bid for UK National Grid

Hong Kong-based billionaire is assembling a bid for a majority stake in the gas distribution business of the UK’s National Grid.

The bid by Li Ka-shing, Asia’s second wealthiest person according to Forbes, will represent new British Prime Minister Theresa May’s first test in terms of interpretation of the government’s new rules on foreign investment in the country’s infrastructure.
Li Ka-shing
FT reports that Cheung Kong Infrastructure, a part of Mr Li’s sprawling global business empire, is leading a group of investors that is likely to submit an initial consortium offer by the end of the week.

The UK prime minister will review the 2002 Enterprise Act to see whether infrastructure should be added to the sectors in which ministers can intervene. At present the government can only step in if a takeover could threaten financial stability, media plurality or national security.

First-round bids for the 51 per cent stake in the business, which distributes gas to nearly 11m customers around the UK, are due by Friday, these and other people involved in the process said.

One other consortium participating in the auction is led by Canada Pension Plan Investment Board, which has put together a group that includes sovereign wealth funds from Kuwait and Abu Dhabi. Another is led by Macquarie and includes backing from Allianz, the German insurer, Dalmore Capital and China Investment Corporation, China’s sovereign wealth fund. 

Mr Li’s Cheung Kong group also bought EDF’s electricity distribution business in 2010 for £5.8bn.

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