Hong Kong player lines up £1.5bn Norweb pitch
Richard Wachman, city editor
Sunday October 14, 2007
Li ka-shing, Hong Kong's richest man, is in pole position to take control of UK electricity distributor Norweb in a deal worth about £1.5bn. The company was put up for sale by United Utilities, owner of North West Water, in June.
Analysts say Li's Cheung Kong Infrastructure Holdings has outbid rival funds, including those linked to banks that include JP Morgan, Goldman Sachs, UBS and Macquarie.
However, Deutsche Bank, which is conducting the sale on behalf of United Utilities, was last night attempting to persuade Li's rivals to raise their bid in a last-ditch attempt to ratchet up the asking price. But observers say its chances of succeeding are slim.
JP Morgan was a late entrant to the battle for Norweb after being distracted by a separate auction for Southern Water, which it bought for £4.2bn last week.
Once the Norweb sale goes through, United Utilities, headed by Philip Green, is expected become a bid target itself after a streamlining programme that has seen the former mini-conglomerate reduced to little more than a holding company for North West Water.
Last year Anglian Water owner AWG and the Northern Ireland electricity company Viridian changed hands, as funds fought over assets that offer owners a stable income stream.
Li, aged 79, and dubbed 'Superman' for his financial acumen, made his money by investing in Hong Kong real estate. He is also boss of Hutchison Whampoa which owns ports and telecoms companies, including 3i in Britain.
According to Forbes magazine, Li is the world's 10th-richest man.