China’s central bank acquires stake in Drax

THE People’s Bank of China has acquired a stake of around 0.7% in Britain’s biggest coal-fired power station.

China’s central bank has built up its stake in Drax, based in Selby, North Yorkshire, over the past year.

A Drax spokesman said the company was aware of the investment, which amounted to about £18m and welcomed all long-term investors.

Last year Beijing established a $200bn sovereign wealth fund, the China Investment Corp, to increase returns on its foreign holdings, and it has taken high-profile stakes in Morgan Stanley and Blackstone Group.

Last month Drax reported earnings before interest, tax, depreciation and amortisation of £206m for the first six months of 2008, down 28% from the first half of last year.

Pre-tax profits fell 45% to £150m.

The fall was attributed to lower margins as fuel costs have increased.

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