Global Biz

HK tycoon buys UK power group

(Agencies)
Updated: 2010-07-30 16:11
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FRANKFURT/PARIS - A consortium headed by Hong Kong billionaire Li Ka-Shing has agreed a deal to buy the UK networks of French power group EDF for £5.8 billion ($9.1 billion).

France's EDF, Europe's second-largest utility by sales, kept its targets for the year as it confirmed the sale of its UK power grids for 5.8 billion pounds ($9.1 billion) to firms controlled by Asia's richest man, Li Ka-shing.

Mr Li is the world's 14th richest man and owns a wide range of companies, including Superdrug in the UK.

The Paris-based company said it had received an irrevocable offer for the grids from a consortium of Cheung Kong Infrastructure, Hongkong Electric and the Li Ka-Shing Foundation.

The company reported first-half EBITDA (earnings before interest, taxes, depreciation and amortization) of 10.4 billion euros ($13.6 billion), beating the 9.8 billion euros SmartEstimate from Thomson Reuters StarMine, which is based on estimates from six analysts.

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StarMine gives more weight to recent estimates and to analysts who have been more accurate than others in the past.

EDF also said on Friday that nuclear output would be higher in 2010 as it confirmed full-year guidance for EBITDA growth of between 3 and 5 percent.

EDF is valued at 15 times earnings per share as calculated by StarMine for the coming 12 months, a 29 percent premium to 25 peers such as Enel from Italy and E.ON from Germany.

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