Severn Trent agrees sale of US business in £48m deal

Midlands utility Severn Trent has sold its North American operation in a deal with values the business at £48m.

The division, Operating Services, US, has been acquired by US investors PPC Enterprises and Alston Capital Partners.

Severn Trent’s North American business operates and manages water and wastewater systems, and provides management services to municipalities and local communities. It operates in all aspects of the water and wastewater process including treatment, networks and customer service.

Liv Garfield, Severn Trent chief executive, said: “The North American division is a strong business that will be better able to grow and flourish under a new US-based owner. Its sale enables Severn Trent to focus on its core strategic activities.”

Proceeds from the sale will be used for general corporate purposes.

EY Corporate Finance acted as sole financial adviser to Severn Trent.

Severn Trent said it would provide a restatement of prior-year results taking account of the divestment in its Q1 trading update on July 19. The business will be reported as a discontinued operation in Severn Trent half-year 2017/18 results announcement on November 23.