Universities Superannuation Scheme Ltd, the sole corporate trustee of one of the UK’s largest pension funds, has agreed to acquire a combined 10.94% stake in Kemble Water Holdings Ltd, the ultimate holding company of Thames Water.
investors QSuper, Alberta Investment Management Corporation (AIMCo) and OPTrust are selling their shares to USS –which , following completion of the deaL, will become the third largest shareholder in the company.
USS is an experienced investor in regulated infrastructure assets, with existing investments in both Heathrow Airport Holdings Limited and NATS in the UK as well as other regulated assets around the world.
Michael Powell, Head of Private Markets Group at USS Investment Management said;
“We are very pleased to acquire a stake in Thames Water, a strategically important UK asset, on behalf of our members. USS is a responsible long term investor and steward for the assets we own and we look forward to developing a long-term relationship with the management team and continuing to strengthen our relationship with Ofwat and other stakeholders".
Gavin Merchant, Head of Real Assets at USS Investment Management said:
"Ofwat has set out clear expectations for the company in terms of both governance arrangements and customer service. We are supportive of the goals of Thames Water’s management team and their objectives to deliver the best possible service to its customers".
Steve Robertson, Chief Executive Officer of Thames Water said:
"We are delighted to welcome USS as an investor in Thames Water. Pension funds need to invest for the long-term on behalf of their members, as we do for our customers, so they are a good partner for us”.
The transaction is expected to close later in the year.
Universities Superannuation Scheme is now one of the biggest pension schemes in the UK in assets under management – with a value of £60.5 billion, according to its latest Annual Report & Accounts.
In the last financial year, investment returns of more than 20% saw the value of its assets grow by £10.2 billion.