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| Version 1 | Version 2 |
|---|---|
| China fund buys 10% stake in London's Heathrow airport | China fund buys 10% stake in London's Heathrow airport |
| (about 20 hours later) | |
| China Investment Corporation (CIC), the country's sovereign wealth fund, has bought a 10% stake in the firm that owns London's Heathrow airport. | China Investment Corporation (CIC), the country's sovereign wealth fund, has bought a 10% stake in the firm that owns London's Heathrow airport. |
| Heathrow Airport Holdings' other UK airports include Stansted, Southampton, Glasgow and Aberdeen. | Heathrow Airport Holdings' other UK airports include Stansted, Southampton, Glasgow and Aberdeen. |
| CIC was set up in 2007 to invest some of China's foreign exchange reserves. | CIC was set up in 2007 to invest some of China's foreign exchange reserves. |
| Despite concerns in other countries about Chinese access to key assets, the UK has been developing closer business ties with China. | Despite concerns in other countries about Chinese access to key assets, the UK has been developing closer business ties with China. |
| "It is fair to say that the UK has a more open relationship with China than many other major economies," said Stephen Joske, senior manager at AustralianSuper, a pension fund based in Beijing. | |
| "There is certainly push all around the world for scrutiny of Chinese investment - it has been ringing alarm bells. | "There is certainly push all around the world for scrutiny of Chinese investment - it has been ringing alarm bells. |
| "It is unfair to an extent, as these deals are a win-win transaction. Politics has been overshadowing economics." | "It is unfair to an extent, as these deals are a win-win transaction. Politics has been overshadowing economics." |
| British opportunities | British opportunities |
| This is CIC's second major investment in UK infrastructure. In January, it bought 8.68% of the firm behind UK utility group Thames Water. | This is CIC's second major investment in UK infrastructure. In January, it bought 8.68% of the firm behind UK utility group Thames Water. |
| The latest airports deal will see the fund pay £450m ($726m) for a 10% stake in Heathrow Airport Holdings Ltd, which was previously known as BAA Ltd. | The latest airports deal will see the fund pay £450m ($726m) for a 10% stake in Heathrow Airport Holdings Ltd, which was previously known as BAA Ltd. |
| Under the terms of the agreement it will buy a 5.7% stake in FGP Topco Ltd from Spanish firm Ferrovial for £257.4m. FGP Topco is the holding company which owns Heathrow Airport Holdings Ltd. | Under the terms of the agreement it will buy a 5.7% stake in FGP Topco Ltd from Spanish firm Ferrovial for £257.4m. FGP Topco is the holding company which owns Heathrow Airport Holdings Ltd. |
| CIC will get the remaining 4.3% stake from other shareholders of FGP Topco Ltd at a cost of £192.6m. | CIC will get the remaining 4.3% stake from other shareholders of FGP Topco Ltd at a cost of £192.6m. |
| The Chinese investment company is not the first foreign firm to buy a stake in the Heathrow holding firm. | The Chinese investment company is not the first foreign firm to buy a stake in the Heathrow holding firm. |
| In August, Qatar Holdings bought a 20% stake, and this deal is currently awaiting approval from European competition regulators. | In August, Qatar Holdings bought a 20% stake, and this deal is currently awaiting approval from European competition regulators. |
| China expansion | China expansion |
| Foreign firms are increasingly looking at the UK for investment opportunities as the economic slowdown has pushed down the price of assets. | Foreign firms are increasingly looking at the UK for investment opportunities as the economic slowdown has pushed down the price of assets. |
| At the same time, problems in the eurozone have made the UK, which is not part of the European single currency, a more attractive and stable destination. | At the same time, problems in the eurozone have made the UK, which is not part of the European single currency, a more attractive and stable destination. |
| Earlier this year, Chinese telecoms and computer network firm Huawei Technologies said it was going to invest £1.3bn expanding its UK operations. | Earlier this year, Chinese telecoms and computer network firm Huawei Technologies said it was going to invest £1.3bn expanding its UK operations. |
| And while UK Prime Minister David Cameron said the investment showed that the UK was "open for business", similar moves in other countries have raised concerns. | And while UK Prime Minister David Cameron said the investment showed that the UK was "open for business", similar moves in other countries have raised concerns. |
| Last month, the US claimed that Huawei and another Chinese firm posed a security risk and warned against doing business with them. | Last month, the US claimed that Huawei and another Chinese firm posed a security risk and warned against doing business with them. |
| In a separate move, US President Barack Obama blocked a wind farm deal involving Chinese firm Ralls Corp, citing national security issues. | In a separate move, US President Barack Obama blocked a wind farm deal involving Chinese firm Ralls Corp, citing national security issues. |
| Australia, meanwhile, has previously blocked Huawei's plans to bid for work on its national broadband network. | Australia, meanwhile, has previously blocked Huawei's plans to bid for work on its national broadband network. |