The consortium, which includes AMP Capital Investors and Kerry Packer's Challenger Financial Services Group among others, is expected to complete the sale in second quarter 2005.

Macquarie Bank will contribute $172 million for a 17% equity stake in DN, out of a total consortium equity commitment of $991 million. The remainder of the acquisition price will be financed by debt provided.

Challenger will invest about $50 million into the consortium as it diversifies its asset base.

The Wales & the West Distribution Network is a regulated gas distribution business

comprising 34,000km of gas distribution pipelines located in Wales and the South West of England.

Chief financial officer for Macquarie Bank, Greg Ward, said: “This asset displays

similar characteristics to the Bank’s investment in the water utility, South East Water,

which has proved very attractive to investors.

“Investors have demonstrated a strong appetite for these types of assets - stable,

essential service businesses generating strong and sustainable cash yields and

operating in a mature regulatory environment.”