UU sells non-regulated water interests

14th Jun 2010 07:12

UK utility company United Utilities (UU) is to offload its principal non-regulated water interests in the United Kingdom and Europe to Veolia Water UK.Veolia is paying £174.2m for the assets, of which £108.6m is cash with the remainder accounted for by £65.6m in net debt assumed by the purchaser. A further £10m in cash is payable on a deferred basis, subject to certain contingencies.The assets being sold include UU's continental European assets, such as its 57.8% stake in Sofiyska Voda AD in Bulgaria, its 26.5% holding in AS Talinna Vesi in Estonia, and its 33.2% holding in Aqua Spolka Akcyjna in Poland.UU is also selling its stake in the 2010-15 capital management contract with Southern Water plus its stake in the capital delivery contract with Southern Water to manage the design and build of a new wastewater treatment works in the Brighton and Hove area.Veolia will also buy UU's industrial solutions business and three Scottish private finance initiatives: 33.33% of Catchment Moray Holdings Limited, 33.33% of Catchment Tay Holdings Limited and 50.0% of Catchment Highland Holdings Limited) and associated operations contracts.Completion of the transaction is expected in the second half of 2010 and is subject to a number of consents and regulatory approvals. United Utilities expects to retain the proceeds within the group.