UK ministers have been urged to intervene if Macquarie, the Australian banking powerhouse, proceeds with its proposed £3bn deal to acquire full control of a crucial part of the UK’s gas grid. A consortium comprising Macquarie Asset Management and British Columbia Investment Management Corporation acquired 60% of the equity in National Grid’s gas transmission and meter business in January, valuing the business at £7.5bn. The consortium has first refusal to purchase the remaining 40% from this summer, which could raise concerns over the future of the UK’s energy infrastructure as officials seek to shift towards low-carbon technologies.
The transmission business operates over 4,000 miles of gas pipes in the UK. Macquarie already owns several UK infrastructure assets, including the gas network Cadent, Glasgow and Southampton airports, and various windfarm projects along the east and north-west coasts of England. However, the bank has faced criticism in the UK over its ownership of Thames Water, where it extracted billions in dividends while its debt soared, and Southern Water, the utility company that repeatedly discharged sewage into the sea.
Gary Carter, GMB national officer, said: “Massive investment is going to be needed to reach net zero and secure the UK’s energy supply for future generations. Can Macquarie really be trusted with whole ownership of owning the nation’s gas transmission business? Macquarie’s reputation is one of maximising profits and stripping assets, often at the expense of investment as well as employees pay and pensions. This government must not sit idly by when energy security is at stake.”
The original 60% investment was scrutinised under the National Security and Investment Act, which examines whether any acquisition would put Britain at risk. Any further deal could also be examined under the act, which was introduced in 2021. The consortium’s initial investment was examined by the Competition and Markets Authority due to its ownership of Cadent, but the watchdog did not find the deal would weaken competition. However, it may choose to scrutinise any further investment.
National Grid, the £42bn private company that runs Britain’s energy network, is in the process of rebalancing its assets away from fossil fuels. During a recent interview with the Guardian, the National Grid chief executive, John Pettigrew, declined to comment on whether the consortium would exercise its option to buy the remaining equity. Asked whether he had any qualms over the original sale given Macquarie’s reputation, he said: “There’s a process that the government goes through with any acquisition to ensure that the…
2023-05-14 07:45:01
Link from www.theguardian.com