Engie to buy UK’s biggest electricity distribution company in £10.5bn deal
French utility to purchase UK Power Networks from Hong Kong’s CK Infrastructure Holdings
Engie has agreed to buy UK Power Networks, Britain’s biggest electricity distribution company, for £10.5bn, as the French utility expands its role in supplying power to households and businesses.
Engie said late on Wednesday it was purchasing UK Power Networks from Hong Kong billionaire Li Ka-shing’s CK Infrastructure Holdings.
The French utility — which counts the French state as a 23 per cent shareholder — has invested in renewable power generation in recent years in continental Europe, the UK and elsewhere alongside its gas production and trading.
Engie has also sought to shift more into operating power supply networks, which offer a predictable stream of revenues set by regulators and serve to smooth the utility’s earnings.
UK Power Networks is one of five monopoly power distribution networks in Britain, deriving its revenues from a portion of customer bills.
The company is the largest electricity distribution company in the UK by number of customers, serving 8.5mn households and businesses across London and the south-east of England.
The deal has an equity value of £10.5bn. Engie said it would finance the acquisition through €4bn of asset sales, new debt and a €3bn capital raising.
Engie chief executive Catherine MacGregor said Britain would become the group’s second-largest contributor of operating profit after France.
She pointed to the UK’s “clear decarbonisation and electrification strategy, which goes hand in hand with considerable investment needs in networks and energy infrastructure”.
The UK has a target of achieving net zero carbon emissions by 2050, which is propelling huge investment in the country’s power networks — so they can cope with higher demand for electricity from households and businesses as part of the pivot away from fossil fuels.
Engie said the deal to buy UK Power Networks was expected to close in mid-2026.
The utility also raised its 2026 profit targets, saying it expected net income of between €4.6bn and €5.2bn this year, up from a previous range of €4.2bn to €4.8bn, due to the acquisition.
In 2022, a plan by CK Infrastructure Holdings to sell UK Power Networks to a consortium involving KKR and Macquarie collapsed after a last-minute price increase by the owner.