Consortium buys Affinity in £1.6bn deal
German insurance company Allianz in a consortium with infrastructure investment firm HICL Infrastructure and fund manager, DIF has bought Affinity Water in a deal worth close to £1.6bn including the company’s debt of more than £850m.
The deal will comprise two transactions with Alliance and HICL each picking up a stake of 36.6% for £269m while DIF will take the rest valuing the company at £735m. Sellers, Morgan Stanley Infrastructure and M&G Investments' Infracapital are parting with a 90% stake with Veolia seling the balance.
Affinity’s chief executive Simon Cocks (pictured) said Affinity did not expect the sale to result in any operational changes. “We look forward to continuing to deliver our enhanced business plan for our customers.”
Morgan Stanley and Infracapital formed Affinity Water through the purchase of Veolia Water's British water supply operations in June 2012 for £1.1bn. Affinity has a regulatory capital value of about £1.15bn. Its shareholders began a strategic review of the business in mid March when a sale was strongly anticipated with a price tag mooted at about £2bn.