Veolia Environnement has sold most of its regulated UK water business for £1.2 billion, representing a premium of about 30 per cent on the regulated capital value.
Infracapital teamed up with Morgan Stanley Infrastructure Partners to buy 90 per cent of the company, leaving Veolia with a 10 per cent stake.
Following the sale, Standard & Poor’s put Veolia Water Central, the largest of three regional arms of the business, on negative ratings watch. It said there was a risk the new owners could burden the company with high acquisition debt to fund the transaction.
Veolia Environnement kept its commercial outsourcing business and Veolia Water Solutions & Technologies. Veolia Water Outsourcing has a turnover of £400 million and employs around 1,000 people.
This article first appeared in Utility Week’s print edition of 6 July 2012.
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