A consortium led by Allianz Capital Partners is to take full control of UK water supply company Affinity Water.
The consortium of Allianz Capital Partners – on behalf of the Allianz Group (36.6%), DIF (26.9%), and HICL, managed by InfraRed Capital Partners (36.6%) – will take control of Affinity later this month.
Infracapital and Morgan Stanley Infrastructure are selling the interest.
The consortium will pay £687m (€813m) for a 90% stake, while the remaining 10% will be sold by Veolia Water UK.
“The UK water sector offers a well-established and transparent regulatory framework that provides Allianz good visibility and a fair return on its investment,” said Christian Fingerle, chief investment officer at Allianz Capital Partners.
“The investment in Affinity Water is another important step in our ambition to grow our portfolio of high-quality core infrastructure assets and it reaffirms our comfort with the UK as a stable jurisdiction in which to invest capital.”
Fingerle said the investment would deliver inflation-linked, stable and predictable cash-flows, “which are ideal for matching long-term payment obligations to the customers in Allianz’s core business of insurance”.
Affinity Water is the UK’s largest water-only supply company by revenue and population served.