Macquarie buys majority share in Southern Water with a pledge to get it back on track
AN Austrailian investment bank has bought a majority stake in Southern Water weeks after the utility firm was fined a record £90m for dumping raw sewage, including at Beaulieu.
Macquarie Asset Management has announced it will invest more than £1bn in the company, and has pledged to put the firm "back on a stable footing".
The cash injection will pay for an upgrade to Southern Water's network infrastructure, including its pipes, pumping stations and sewers which Macquarie admitted were currently underperforming and "causing harm to the local environment".
Leigh Harrison, head of infrastructure and real assets at Macquarie, said: “Southern Water needs significant investment to improve its operational and environmental performance, and financial health.
"Without it, the business will be unable to fulfil the expectations of the millions of customers that rely on its services each day or reduce its negative impact on the local environment.
Ian McAulay, chief executive of Southern Water, added the investment would also create around 1,000 new jobs and expand its apprenticeship programme.
"This investment ensures we will be able to spend more than £2bn in the next four years improving the resilience of our existing network to reduce pollution incidents and leakages," he said.
"It strengthens our ability to tackle the longer-term challenges posed by climate change and population growth, at the same time as being responsible custodians of Southern England’s rivers and seas."
However, the GMB union has criticised the move, saying that “swapping private owners won’t bring the investment and commitment to the environment" that is needed.
"Weak regulation of private water companies has failed," said national officer Gary Carter. "It’s time to bring back the tap into public ownership, where the needs of local customers and Southern Waters employees are put first.”
As reported in the A&T, Southern Water pleaded guilty last month to polluting waterways, including Beaulieu River, between 2010 and 2015. The judge in the case slammed Southern Water for its "shocking and wholesale disregard for the environment".