3rd Jul 2015 11:00
LONDON (Alliance News) - The Competition and Markets Authority Friday said the inquiry group investigating Pennon Group PLC's completed acquisition of Bournemouth Water Investments Ltd will present a report before the end of November.
Water utility and waste management company Pennon Group struck a deal in April to acquire Bournemouth Water from Sembcorp Holdings Ltd for GBP100.3 million, which was immediately completed.
The acquisition by FTSE 250-listed Pennon, which owns South West Water, was then automatically referred to the CMA in June for a mandatory in-depth investigation.
South West Water and Bournemouth Water both supply water to household and non-household customers.
On Friday, the CMA said: "The inquiry group of CMA panel members investigating the merger must decide whether a relevant water merger has taken place and, if so, whether the merger has prejudiced, or may be expected to prejudice, the ability of Ofwat to make comparisons between water enterprises."
The inquiry group must report on the investigation before November 22, but the CMA stressed that it is a mandatory investigation and that it does not imply that any concerns about the deal have been found.
To finance the deal, Pennon issued 12.1 million shares at 830 pence per share, raising the full GBP100.3 million required to finance the deal. The new shares represented an increase of around 3% in the company's share capital prior to the issuance.
Pennon shares were down 0.6% to 817.88 pence per share on Friday.
By Joshua Warner; [email protected]; @JoshAlliance
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