Water Industry News


Fri 24 Feb 2006

Kelda sells Aquarion to Macquarie

LONDON (Reuters) - Water company Kelda Group Plc said on Friday it was selling its U.S. water business Aquarion to Australia's Macquarie Bank Ltd for an enterprise value of around $860 million (490 million pounds).

Kelda said the sale of Aquarion, one of the largest investor-owned U.S. water utilities with 700,000 customers, would allow it to focus on its UK business, which saw profits benefit last year from rising bills.

It is also not making or losing any money from the sale.

Kelda Chief Executive Kevin Whiteman said the transaction was expected to close once regulatory clearances are given "towards the back end of 2006".

Kelda, which provides water services to around 4.7 million people and 140,000 businesses in Britain, had already said it was looking at its options for Aquarion and a key decision on its future was due.

It is leaving the United States after a five-year spell.

"One of our big drivers for expansion (into the United States) ... was the expectation that there would be significant market consolidation and that simply hasn't happened," Whiteman told reporters on a conference call.

Its shares were 2.6 percent up at 808-1/2 pence by 1:15 p.m., valuing the group at around 3 billion pounds.

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