Investor perceptions of British Gas plc at 31 December 1991

Ernst and Young report (51 pages, PDF) for Ofgem reviewing the market perception of British Gas plc in 1991, prior to the separation of the transmission and trading activities. The report concludes that investors probably did not value the company on the basis of the values of individual parts. Based on this review, Ofgem decided to continue using the "unfocused" method (a pro rata allocation of market valuation to different businesses according to accounting net asset values) in order to set the initial regulatory asset value for the transportation business.

Filed under Gas, Ofgem, Price controls.

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