Pennon focuses on £ 490 million fundraising for infrastructure investments

  • The FTSE 250 company owns Bristol Water and South West Water
  • Pennon plans to invest in large reservoirs, such as Cheddar 2 in Bristol

Pennon Group has unveiled plans for an important issue to finance £ 3.2 billion in water infrastructure investments over the next five years.

The FTSE 250 company, which owns Bristol Water and South West Water, is planning to raise around £ 490 million by spending nearly 186 million shares at 264 p each.

This offer represents a 35.2 percent discount on the theoretical ex-right price, which was calculated using Pennon’s final price of 500.8p on Tuesday and has been adapted for last year’s interim dividend of 14.7 pence per share.

Pennon said that the financing will ensure that it has a ‘sustainable balance’ during the regulations period from March 2025 to April 2030.

At that time, the company plans to spend a record of £ 3.2 billion in Surrey and Zuidwest -England on improving the water infrastructure and achieving net zero about its activities.

It is planning to invest in large reservoirs, such as Cheddar 2 in Bristol, one third of the water treatment works in Devon and Cornwall to reduce leaks on its networks to less than 10 percent and less than 4 percent on the customer’s property .

Financing: Pennon Group has unveiled plans for an important issue to finance £ 3.2 billion in investments over the next five years

By 2030, Pennon also promised to plant 300,000 trees and to stop storm crossing at baths and shellfish waters.

However, the company established in Exeter has also said that it would increase the water service bills of customers by £ 4 per month and for sewerage services by £ 5 per month.

Water regulator or somewhat approved much smaller increases in his price overview last month than Pennon had suggested.

Although it has sworn £ 200 million in support for those who may have difficulty paying, Pennon further announced on Wednesday that dividends would increase in line with inflation every year until 2030.

Pennon paid £ 129.3 million in total dividends to investors in the year ending on March 2024.

In recent years, water companies have received enormous criticism for paying shareholders considerable dividends despite their environmental record and high debts.

In September, Pennon unveiled an impact of £ 16 million from a contamination incident in Devon, at the same time when cases of storm redundancy were jumped over his network.

Earlier in the year, the group implemented a ‘cooking water message’ in the city of Brixham for eight weeks after a parasite was discovered in a nearby reservoir.

Pennon apologized for the outbreak, which led to more than 100 people reporting symptoms such as diarrhea and dehydration.

After the incident, Pennon waved to an adjusted loss of £ 13.8 million in the six months ending on September.

Pennon Group -Shares were 1.8 percent lower at 506p on Wednesday morning and took up their losses to around 27 percent in the past year.

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