Cheung Kong sells UK Rails to reconfigure capital, with reports indicating that reserve funds are for a "larger transaction" as part of the overall strategy of the Cheung Kong Group

CKI HOLDINGS (01038.HK) stated that the transaction for the sale of the UK rail vehicle leasing company UK Rails (Eversholt Rail), led by its consortium, is expected to be completed within this month. Li Ka-shing, Chairman of CKI Holdings, mentioned in July last year that "there must be buying and selling" for the business to grow larger, and pointed out that the group has always preferred not to borrow, thus regularly reserving funds for larger transactions.

According to analysis reports published by HSBC and JP Morgan in July last year, the cumulative return from the sale of UK Rails (Eversholt Rail) is approximately twice the original investment. Among them, JP Morgan believes that this move demonstrates CKI HOLDINGS' ability to reallocate capital to enhance shareholder returns, suggesting that CKI may invest capital to acquire projects with reliable and robust cash flows, while HSBC indicated that the cash generated from the transaction is likely to be reallocated to investment opportunities with better risk-return profiles and potential synergies with existing businesses.

Sources close to CKI Holdings stated that Li Ka-shing's response to the transaction, as well as the comments from HSBC and JP Morgan analysts' reports, are considered applicable not only to CKI HOLDINGS but also to the overall strategy of the CKI Group