Chinese to bid for National Grid gas pipeline

Updated: 2016-09-20 17:42

By ANGUS McNEICE(China Daily UK)

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Chinese to bid for National Grid gas pipeline

Chinese firms are reportedly among potential bidders to acquire a stake in UK utility National Grid's gas pipeline network. [Photo/Agencies]

A group of Chinese investors is to bid at auction for UK utility company National Grid's gas pipeline network.

The network is valued at an estimated 11 billion pounds($14.3 billion) and serves 10.9 million homes and businesses across Britain.

According to media reports, the consortium involves Fosun and China Gas, who will compete with rival bidders, including two other groups led by Canada Pension Plan Investment Board and Australian bank Macquarie.

Bids are due by the end of the month and must meet a minimum requirement of comprising 51 percent of the new company. National Grid will remain as a minority shareholder.

A National Grid spokesman declined to identify the Chinese investors.

The two Chinese companies had made no comment on the issue by press time.

National Grid announced plans to sell a majority stake in November last year in a sale to be handled by Barclays, Morgan Stanley and Robey Warshaw.

Reports of the Chinese interest come just a week after British Prime Minister Theresa May disclosed plans to tighten regulation on foreign involvement in UK infrastructure development.

Last week, after unexpectedly withholding government consent in July, May gave approval for Hinkley Point C, a new 18 billion pound nuclear power station project to be built in southwest England by French energy company EDF with investment of 6 billion pounds from China General Nuclear Corp.

Greg Clark,UK secretary of state for business, energy and industrial strategy, said after the decision was announced that "Having thoroughly reviewed the proposal for Hinkley Point C, we will introduce a series of measures to enhance security and will ensure Hinkley cannot change hands without the government's agreement."

The measures will also apply to future nuclear projects, and changes of ownership for other large infrastructure projects, such as the National Grid sale, will face increased scrutiny.

Sean Kemp, National Grid's UK head of media relations, said in a statement:"We will not speculate on the identity of potential bidders. The new owner will operate under the relevant requirements."