Macquarie, CIC join consortium to buy control of UK gas distributor

Other investors include Qatar Investment Authority, Germany-based Allianz Capital Partners and UK firms Dalmore Capital and Amber Infrastructure. The consortium will take a 61% stake in National Grid Gas Distribution (NGGD), leaving the company's current London-listed owner, National Grid, with the remaining 31% holding. Compensation is set to comprise GBP3.8 billion in cash and GBP1.8 billion in debt financing.

The transaction is scheduled to be completed in March 2017 after receipt of merger clearance from the European Commission. By this time, NGGD's regulated asset value is expected to total GBP9 billion. According to a statement, National Grid and the consortium have expressed interest in a follow-on sale for an additional 14% of the company.

"This is a well-established business and we are confident that as investors we can continue to provide both high quality infrastructure for the UK and appropriate risk-adjusted returns for investors," Martin Stanley, global head of MIRA said. "MIRA has longstanding operational experience in managing utilities and critical infrastructure in the UK, across Europe and around the world and we are committed to being a long-term investor in and a responsible custodian of National Grid Gas Distribution."

NGGD distributes gas to nearly 11 million households and businesses via networks covering regions across the UK, including London, Birmingham and Manchester. The company had gross assets of GBP8.7 billion as of September 2016 and reported a before-tax profit of GBP717 million for the 2016 financial year.

CIC has previously been active in the UK with an investment in Thames Water Utilities and the purchase of a 10% stake in Heathrow Airport for GBP450 million in 2012. More recent infrastructure plays by the firm include participation in a consortium buying Australian rail freight and cargo port operator Asciano for A$9 billion ($$6.8 billion).

MIRA claims to be the world's largest infrastructure manager with more than GBP70 billion in infrastructure assets under management across 27 countries. It closed an Asian regional platform earlier this year at $3.1 billion that has since committed EUR26 million ($28.9 million) for a 40% interest in Japanese logistics company Nippon Vopak.

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• Topics
• Europe
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• Buyouts
• China
• Australia
• CIC
• Macquarie Group
• energy
• Consumer