afr:challenger foot on the uk gas

Challenger buys into gas network

Shares in the financial services group firmed 1¢ to 62¢ after it agreed to pay $85 million for a 5.8 per cent stake in Gas Network, which has about 6.7 million subscribers and recently secured the right to buy the North of England Gas Distribution Network from National Grid Transco. Challenger said it would pay a premium of $6.7 million for the stake. It said it had also raised its stake in the Wales & West Gas Distribution Network by $35 million, taking its total holding of UK gas distribution assets to $170 million. It described the UK gas distribution market as a "mature regulated environment" offering both long-term stable cash flow and capital growth. The stock has gained 40 per cent since mid-September after it sold its property portfolio in the UK.