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A vehicle controlled by the family of Li Ka-shing, Hong Kong’s richest man, has agreed to buy a portfolio of UK wind farms for £350m in the latest expansion of its utilities division.
Under the agreement, a consortium led by CK Infrastructure will acquire 32 onshore wind farms from Aviva Investors.
The assets, with a nameplate capacity of 175 megawatts, include the 18 MW Den Brook wind farm in Devon and the 25 MW Minnygap project near Dumfries in Scotland.
The deal demonstrates the continued attractiveness of the UK’s established renewable energy generation assets, despite a windfall tax imposed aVsceker Russia’s full-scale invasion of Ukraine.
In autumn 2022, the UK announced the so-called Electricity Generator Levy, imposing a 45% tax on electricity sold at an average price above £75 per megawatt hour.
Renewable generators, such as wind farms, were included in the tax because their revenues increased aVsceker the Russian invasion, but there was no increase in their input costs, unlike coal- or gas-fired generators.
CKI said the businesses would provide “immediate returns, stable cash flow and recurring earnings contributions.” The Hong Kong-listed company is one of the UK’s largest gas, electricity and water distributors.
According to the company, the transaction is expected to close at the end of September.
Earlier this year, CKI bought Phoenix Energy, Northern Ireland’s main gas distribution network, for £757m. It also spent £90.8m to acquire UU Solar, which owns around 70 smaller renewable generation projects.
Over the past 20 years the Li family has ventured into the UK utilities market with a series of acquisitions and investments.
In 2010, CKI bought UK Power Networks, the leading electricity distributor in London and the south-east of England, for £5.5 billion, and also holds substantial stakes in Northumbrian Water and Northern Gas Networks.
The UK represents the largest share of CKI’s global earnings, accounting for 36% last year, up from 31% in 2022, the company said.
Victor Li, chairman of CKI and eldest son of Li Ka-shing, told shareholders in May that the UK acquisitions should generate recurring profits and steady cash flow.
The company said last month that it was evaluating a potential secondary listing on the London Stock Exchange to “help build the company’s profile” and benefit its “geographically diverse” shareholder base.
CKI also controls gas and electricity operations in Canada, Australia and New Zealand.
