• 6 minutes Corporations Are Buying More Renewables Than Ever
  • 17 minutes WTI @ 67.50, charts show $62.50 next
  • 23 minutes Starvation, horror in Venezuela
  • 20 hours Permian already crested the productivity bell curve - downward now to Tier 2 geological locations
  • 1 day Desperate Call or... Erdogan Says Turkey Will Boycott U.S. Electronics
  • 19 hours Renewable Energy Could "Effectively Be Free" by 2030
  • 20 hours Saudi Fund Wants to Take Tesla Private?
  • 1 day Mike Shellman's musings on "Cartoon of the Week"
  • 2 days Venezuela set to raise gasoline prices to international levels.
  • 2 days The Discount Airline Model Is Coming for Europe’s Railways
  • 1 day Pakistan: "Heart" Of Terrorism and Global Threat
  • 1 day Are Trump's steel tariffs working? Seems they are!
  • 2 days Scottish Battery ‘Breakthrough’ Could Charge Electric Cars In Seconds
  • 2 hours Hey Oil Bulls - How Long Till Increasing Oil Prices and Strengthening Dollar Start Killing Demand in Developing Countries?
  • 13 hours Why hydrogen economics does not work
  • 12 hours China goes against US natural gas
Canada’s Pipeline Crisis Is A Boon For Russia

Canada’s Pipeline Crisis Is A Boon For Russia

The Trans Mountain pipeline struggle…

India Surges Ahead In Global Solar Race

India Surges Ahead In Global Solar Race

India is soaring past the…

Severn Trent Water Company Rejects £5 Billion Takeover Bid

The British water company, Severn Trent, has just rejected a second, revised offer of £5 billion ($7.68 billion) from a consortium led by the Kuwait Investment Office, a sovereign wealth fund. Severn Trent believes that the offer still fails to reflect the long-term potential of the company.

The consortium, known as LongRiver, also includes Borealis Infrastructure (part of the Canadian pension fund, OMERS), and Britian’s Universities Superannuation Scheme, and made an offer equal to 2,079.49 pence per share, a 16% premium on the share price.

Stephen Hunt, an analyst at UBS, also agrees that the bid was low, short of his estimate of 2,150 pence per share. “I think a third and final offer that is accepted is certainly not off the cards,” he said.

British water and sewage treatment companies are a very attractive opportunity for investors that are keen to secure good yield due to their stable cash flows and the favourable regulatory structure in the UK. Of the ten water utilities in the country, only Pennon Group, United Utilities, and Severn Trent remain as listed entities, the others are now held by private investors.

Related article: Myanmar Attracting Major Energy Investors

Severn Trent released a statement saying that, “the board unanimously believes that LongRiver's revised conditional proposal ... fails to value the attractions to Severn Trent's shareholders of Severn Trent's increasingly rare combination of yield, inflation-linked business model and potential.”

LongRiver were disappointed by the decision, claiming that their “revised proposal is highly deliverable, appropriately financed and would offer certain and compelling value to Severn Trent's shareholders, recognising its higher cost of debt and long term prospects.”

LongRiver has until the 11th June to make another bid, a deadline set by the British Takeover Panel.

By. James Burgess of Oilprice.com



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News