Northumbrian Water yesterday confirmed it had received a takeover proposal from a Chinese tycoon.
Earlier this week it emerged that a firm run by Hong Kong billionaire Li Ka-Shing was "assessing" whether to make a cash offer for the utility firm based at Pity Me, near Durham City,
In a statement to the London Stock Exchange yesterday Northumbrian Water said: "The board confirms that it has now received a non-binding indicative proposal from Cheung Kong Infrastructure Holdings Limited regarding a possible cash offer for the Company.
"There can be no certainty that an offer will be made. A further announcement will be made when appropriate."
Cheung Kong Infrastructure Holdings(CKI) is the investment vehicle of self-made billionaire Mr Ka-shing, known in Hong Kong as Superman because of the business prowess that has made him the world's 11th richest person with an estimated personal fortune of $26bn.
He already has stakes in a number of UK utility companies, including Southern Water, Cambridge Water and Northern Gas Networks.
In July last year, he headed a consortium which bought the UK electricity distribution networks of French energy firm EDF for £5.8bn ($9.1bn).
In May Northumbrian, which also owns Essex & Suffolk Water, announced a leap in annual profits to £181m from £170.2m.
The firm employs 936 at its Pity Me head office and 2,884 in total.
It has 4.4m customers and is valued at about £2bn.
Middlesbrough South and East Cleveland Labour MP, Tom Blenkinsop, yesterday expressed concern about a possible deal with the Chinese firm.
Mr Blenkinsop said about a third of the UK's total utility infrastructure was now under foreign ownership and said: "These services are too important to become the playthings of wealthy speculators."
He added: "I would want to see guarantees that jobs for Northumbrian Water's many thousands of employees would be protected."
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