Vital gas pipelines sold off to foreign investors

A CRITICAL UK gas pipeline supplying 11m homes and businesses has been sold for £13.8bn to a consortium of investors from Australia, China and Qatar.

The sell-off of a majority stake in the National Grid gas network will trigger a bumper payday for shareholders, who will split £4bn from the deal.

And it will mean a massive payout for investment bankers and lawyers involved in the deal, who will share millions.

But the sale has raised huge concerns about a major part of UK infrastructure being sold to foreign investors.

It comes months after Prime Minister Theresa May said she wanted the Government to be able to intervene in foreign investment in crucial industries, and announced a review into relevant law.

Yesterday, though, asked whether the proposed takeover of the National Grid by a Chinese firm raised concerns, the PM’s official spokesman said: ‘I don’t have anything specific to say on that case.

‘There are already a number of processes and checks in place and we have set out how we will strengthen those.’

Concerns have been raised about the investors involved in the deal.

The consortium that has taken a 61pc stake in National Grid includes Australian investment bankers Macquarie; China’s sovereign wealth fund, the China Investment Corporation; and Qatari wealth fund Qatar Investment Authority. The rest are financial services group Allianz Capital Partners, UK-based Hermes Investment Management and British fund managers Dalmore Capital and Amber Infrastructure Limited/ International Public Partnerships.

Particular worries are related to China’s stake in the UK’s power networks, and the intentions of Macquarie, which already owns Thames Water.

Its ownership of that firm has been heavily criticised because it has been accused of stripping millions of pounds of dividends from the business while failing to properly invest in infrastructure.

In 2013 alone, despite achieving a turnover of £1.8bn and profits of £550m, it paid no corporation tax.

The Unison union said its ownership had led to poorer customer service and higher bills, and officials fear the same at National Grid.

Thames Water said under current ownership £1bn had been invested every year for the past ten years.

Dave Prentis, general secretary of Unison, said: ‘Once again the Government’s done nothing to encourage a transfer to British hands.’

John Pettigrew, chief executive of National Grid, stressed that the consortium ‘has a long-term commitment to the UK with significant experience in owning infrastructure assets’.

Energy union GMB welcomed the deal putting an end to uncertainty, but warned about key infrastructure decisions being taken abroad.