First State, JP Morgan sell remaining shares in Electricity North West

04 December 2019 - 12:00 am UTC

First State Investment and JP Morgan Asset Management have sold the remaining shares in UK network operator Electricity North West to existing shareholders Kansai Electric Power and Equitix, as well as China’s CNIC Corporation.

Chinese state-owned investor CNIC Corporation has joined a Kansai Electric Power-led consortium and Equitix in acquiring the remaining 50% of shares in UK network operator Electricity North West (ENW) from First State Investment and JP Morgan Asset Management.

The move bolsters Japanese utility Kansai’s presence in European electricity distribution, which together with Daiwa, MUFG and JV partner Equitix acquired 50% of shares in the company in July.

The transaction also represents a strategic play for CNIC, which last year moved into European energy distribution with the acquisition of a 33.3% stake in Spanish gas distribution firm Redexis.

Its stake in that company, which it purchased with equity from Goldman Sachs Infrastructure Partners, is managed by Vantage Infrastructure.

ENW operates the electricity grid in an area of northwest England stretching from Manchester to rural Cumbria.

Its new sponsors are expected to deliver current price controls until March 2023, while delivering a plan for Ofgem’s next five years of price controls up to 2028.

Regional distribution network operators (DNOs) receive revenue based on the regulatory asset value (RAV) of their assets, which increases as more is invested.

First State and JP Morgan Asset Management, which managed shares in ENW on behalf of their institutional investors, have now exited the firm.

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