Power Assets Holdings (HKG:0006) (PAH) announced earlier that it planned to acquire MGN Gas Networks (UK) Limited in the UK in a consortium of related parties including Cheung Kong (Holdings) (HKG:0001) (30% stake), Cheung Kong Infrastructure (HKG:1038) (30%), PAH (30%) and Li Ka Shing Foundation (10%). The total consideration is GBP645 million.

MGN Gas indirectly holds the entire issued share capital of Wales & West Utilities Limited (WWU).

Goldman Sachs Global Investment (GS) stated in its research report that the WWU acquisition was only slightly accretive, and it expected the estimated earnings per share for 2012 and 2013 will only rise by 0.5% and 2% respectively. The brokerage did not expect the consortium to sell down its other gas assets and believed that there will be more acquisitions to come.

GS has revised the estimated earnings per share of the company for 2012-2014 upwards by an average of 4%. It also raised the target price by 2% to HK$65 and rated the stock as "Neutral".

Source:chinesestock.org