The European Investment Bank (EIB) is providing a £100 million (€136 million; $153 million) loan to Southern Water, the English water and wastewater services firm which serves 4 million customers in Kent, Sussex, Hampshire and the Isle of Wight.
A statement said the 10-year loan was the first made to Southern Water by the EIB – which is the largest lender to the water sector in the world – and the first investment support given to any UK water company for the 2015-2020 regulatory investment period.
The loan will support capital investment by Southern Water “to ensure a constant supply of high quality drinking water and effective treatment of waste water, and improve the quality of bathing water along the south coast”.
The statement added that the loan will support a £63 million redevelopment of the wastewater treatment works at Woolston, near Southampton, which will ensure treated wastewater from the site meets new standards set by the UK’s Environment Agency.
Southern Water is owned by Greensands Holdings, a consortium of investors which took control of the business in 2007 and comprise 48.8 percent infrastructure funds, 41.7 percent Australasian and Canadian pension funds and 9.5 percent private equity funds. The infrastructure funds are managed by JP Morgan Asset Management, UBS Global Asset Management and Hermes.
The EIB last year provided £6 billion for investment in UK infrastructure including new hospitals, water and sewerage infrastructure, renewable energy and energy transmission.