Pipeline peaks

8 December 2016 By Olaf Storbeck

China and Qatar are among buyers of a 61 pct stake in the utility’s UK gas distribution unit. The 3.6 bln pound deal matches a seller that does not need the cash and buyers content with low-yielding assets. Yet prices in infrastructure acquisitions may be nearing a peak.

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Britain's National Grid agreed to sell a 61 percent stake in its UK gas distribution business to a consortium of international investors on Dec. 8 for 3.6 billion pounds ($4.6 billion). The deal values the unit at around 13.8 billion pounds including debt.

The consortium, called Quad Gas Group, comprises Macquarie Infrastructure and Real Assets, Allianz Capital Partners, Hermes Investment Management, CIC Capital Corporation, Qatar Investment Authority, Dalmore Capital and Amber Infrastructure Limited/International Public Partnerships.

National Grid will also extract 1.8 billion pounds in cash, from debt taken on by the acquisition vehicle. After the deal, the UK group will hand back 4 billion pounds to its shareholders through a combination of share buybacks and a special dividend.

Shares in National Grid were up 0.7 percent to 915.0 pence at 0951 GMT.

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