U.K. Pennon Eyes Southern Water Takeover, Report Says
U.K.’s Pennon Eyeing Southern Water Takeover, Sunday Times Says
(Bloomberg) --
British water and wastewater company Pennon Group Plc is considering a takeover of rival Southern Water Services Ltd., according to the Sunday Times.
Pennon sold its waste-management arm to KKR & Co. for 4.2 billion pounds ($5.5 billion) in March, in one of the biggest deals at the start of the coronavirus pandemic. The deal was set to include net cash proceeds of 3.7 billion pounds, and Pennon wants to use the funds for a takeover rather than hand it back to shareholders, the Sunday Times said.
Southern has faced a turbulent period in recent years, including regulator investigations and concern about high dividends and debt, according to the Times. Pennon has also examined other companies, with Southern Water the most likely target, the report said.
Representatives for Pennon and Southern Water declined to comment on the report when contacted by Bloomberg.
Pennon’s shares have climbed about 1.6% this year to 1,041.50 pence in London.
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