Severn Trent says bid drained it of £19m

Water company Severn Trent racked up £19 million in costs associated with an aborted £5 billion takeover approach from a Canadian-led consortium.

The LongRiver consortium, which comprised Borealis Infrastructure Management, the Kuwait Investment Office and the Universities Superannuation Scheme, abandoned its bid for Severn Trent last month after the water firm said the proposal undervalued the company’s long-term potential.

In a trading update, the utility said: “In addressing this approach, the board of Severn Trent has incurred costs for advisory, legal and other services of approximately £19m.”

The group also said that trading across its various divisions was in line with its expectations, and it would be keeping a close eye on changes to the benefits system to see whether customers were struggling to pay their water bills, which rose by 2 per cent in April.