Royal Bank of Scotland (RBS) has put their water utility Southern Water up for sale for around £4 billion sources announced on Sunday.

The company, which supplies water to Kent, Sussex and Hampshire in southern England, will be sold by the private equity arm of RBS in an auction possibly starting as early as this week according to reports in various Sunday papers.

"Our ownership of Southern Water is under review as part of the normal course of business," a spokesman for RBS said.

Deutsche Bank has been appointed to advise RBS on strategic options, including a possible sale, sources said.

It is though that RBS wants to take advantage of soaring valuations in the sector, and it is anticipated that many more water companies will follow suit when results are published this week.