17th Sep 2021 12:36
(Alliance News) - The UK competition regulator has opened an investigation into water utility Pennon Group PLC's takeover of Bristol Water and is inviting comments on the matter.
Back in June, the UK Competitions & Markets Authority slapped Pennon with an initial enforcement order over the potential deal.
Now, the CMA said it will look into the takeover and if any potential move will result in a "substantial lessening of competition".
On Friday, the CMA added: "The CMA is also considering pursuant to section 32(b) of the Water Industry Act 1991 (WIA91), whether it is or may be the case that a merger of two or more water enterprises has taken place and, if so, whether the creation of that situation is likely to prejudice Ofwat's ability, in carrying out its functions, to make comparisons between water enterprises."
Exeter-based Pennon bought neighbour Bristol Water earlier in June for an equity value of GBP425 million and enterprise value, including debt, of GBP814 million.
"This latest acquisition...firmly cements Pennon as one of the leading UK water and waste water companies," Chief Executive Susan Davy said at the time.
Shares in Pennon were down 0.4% at 1,240.00 pence each in London on Friday.
By Paul McGowan; [email protected]
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