Slaughter and May advised Pennon Group Plc (“Pennon”), owner of South West Water, Bristol Water and Bournemouth Water, in relation to its acquisition of Sumisho Osaka Gas Water UK Limited, the holding company of Sutton and East Surrey Water plc (“SES Water”) and certain other ancillary businesses, for £89 million, representing a total enterprise value of £380 million. SES Water is a drinking water-only supplier in the South East, supplying 160 million litres of clean water every day to around 745,000 customers across East Surrey, West Sussex, West Kent and South London.
Slaughter and May also advised Pennon on its equity raise announced on 10 January 2024, comprising a placing to raise gross proceeds of approximately £173 million (the “Placing”) and related retail offer conducted through the PrimaryBid platform to raise additional gross proceeds of approximately £7 million (the “Retail Offer”). The successful Placing and Retail Offer were conducted at a discount of approximately 2.6% to the closing market price of Pennon shares on 9 January 2024 and involved the issuance of approximately 9.4% of the existing ordinary share capital of Pennon to raise gross proceeds of approximately £180 million. The proceeds will be used to ensure that the pro forma leverage and capital structure for the enlarged Pennon group following the acquisition remains consistent with Pennon’s well-established water business gearing range of 55-65%.
Slaughter and May worked as part of an integrated team with the Pennon in-house legal team, led by Andrew Garard (Group General Counsel and Company Secretary).