National Grid Transco American depository shares were higher nearly 2% in recent pre-market trade after the electricity and gas utility company focused on transmission and distribution activities in electricity and gas, said that it has agreed to sell a 61% equity interest in its UK gas distribution business to a consortium of long-term infrastructure investors.
The consortium comprises Macquarie Infrastructure and Real Assets, Allianz Capital Partners, Hermes Investment Management, CIC Capital Corporation, Qatar Investment Authority, Dalmore Capital and Amber Infrastructure Limited/International Public Partnerships.
The terms of the transaction imply an enterprise value for the UK gas distribution business of GBP13.8 billion ($17.44 billion). In consideration for the sale of its equity interest, on completion National Grid will receive a payment of GBP3.6 billion in cash from the consortium and will own a 39% minority equity interest in a new holding company for gas distribution business. In addition, National Grid will receive GBP1.8 billion from additional debt financing.