National Grid has agreed to the potential sale of a 25 per cent share in Cadent Gas to the Quadgas consortium for £1.2 billion in cash.
Quadgas purchased a 61 per cent stake in the business in March 2017, and as part of the sale, secured the option to buy a further 14 per cent at a later date.
If the consortium exercises both options, it will be left as the sole owner of Cadent, which operates four of Great Britain’s eight gas distribution networks. The networks cover north London, the North West, the East of England and the West Midlands, and together serve roughly half of all connected households in the UK.
According to the terms of the agreements, the acquisitions must be completed between the beginning of March and end of October in 2019, with at least six months’ written notice.
In a statement, National Grid said the proceeds would be reinvested in its other businesses.
The Quadgas consortium consists of Macquarie Infrastructure and Real Assets, Allianz Capital Partners, Hermes Investment Management, CIC Capital Corporation, Qatar Investment Authority, Dalmore Capital and the International Public Partnerships fund run by Amber Infrastructure Limited.
As of the end of March, Cadent had a regulated asset value of £9 billion and totals debts of £7.7 billion.