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Suez Shores Up French Water Stake with Nantaise
On 28 April 2015, Suez Environnement announced its acquisition of Nantaise des Eaux Services (NDES) from Gelsenwasser AG for an undisclosed amount. Headquartered in Nantes, the French private water utility NDES operates nationwide, with a stronghold in the western regions of Brittany, Pays de la Loire and Poitou. As of end-2013, NDES employed over 320 people and had 150 contracts with local authorities, serving 750,000 people. This is the first domestic deal and the third European transaction that Suez has completed over the past year, following its share increases in Acea (February 2014) and Grupo Agbar (September 2014).
The acquisition follows a dynamic half year for Suez municipal concessions: the City of Lille (1.2 million served, €445 million contract) disqualified Suez’s renewal bid on 3 October 2014. But then between December 2014 and March 2015, Suez renewed contracts with Saint Cloud, Gennevilliers, Calais, and Alençon that total over €1 billion. In Suez’s Q1 2015 results, the firm has highlighted 4.4% growth in France water revenues based on these renewals.
Pennon Consolidates South West UK Position
On 16 April 2015, Pennon Group Plc announced the acquisition of 100% of Sembcorp-owned Bournemouth Water for US$285 million including debt (£187 million). Pennon Group is an environmental services and utility firm whose principal holdings include regional utility South West Water, and Viridor waste management services.
Bournemouth Water, acquired by Sembcorp in July 2010, is England’s 16th largest utility. The utility’s activities are exclusive to supplying water only. The firm generated US$81 million in revenue in 2013-2014 with an operating profit of $25 million.
Both South West and Bournemouth received Final Price Determinations from UK regulator Ofwat in December 2014, with South West achieving Enhanced Utility status earlier in the year.
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