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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 £350mn in the latest expansion of its utility arm.
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 18MW Den Brook wind farm in Devon and the 25MW Minnygap project near Dumfries in Scotland.
The deal shows the ongoing attraction of established renewable power generation assets in the UK, despite a windfall tax imposed after Russia’s full-scale invasion of Ukraine.
The UK announced its so-called Electricity Generator Levy in the autumn of 2022, imposing a 45 per cent charge on electricity sold at an average price of more than £75 per megawatt hour.
Renewable generators such as wind farms were included in the levy because their revenues jumped after the Russian invasion but there was no increase in their input costs, unlike coal or gas generators.
CKI said the assets would provide “immediate returns, stable cash flows and recurring profit contributions”. The Hong Kong-listed company is one of the biggest gas, electricity and water distributors in the UK.
The transaction is expected to complete in late September, the company said.
Earlier this year, CKI bought Phoenix Energy, Northern Ireland’s main gas distribution network, for £757mn. It also spent £90.8mn to acquire UU Solar, which owns about 70 smaller renewable generation projects.
The Li family has ventured into the UK utility market with a series of acquisitions and investments over the past 20 years.
CKI bought UK Power Networks, the main electricity distributor in London and the South East of England for £5.5bn in 2010, and also owns substantial stakes in Northumbrian Water and Northern Gas Networks.
The UK accounts for the largest share of CKI’s profit globally at 36 per cent last year, up from 31 per cent in 2022, the company said.
Victor Li, chair of CKI and the elder son of Li Ka-shing, told shareholders in May that its UK acquisitions are expected to deliver recurring profits and consistent cash flows.
The company said last month it has been exploring a potential secondary listing on London’s stock market in order to “assist in building the company’s profile” and benefit its “geographically diverse” shareholder base.
CKI also controls gas and electricity assets in Canada, Australia and New Zealand.
