Canada Pension Plan Investment Board is investing $750m (€668.3m) in US water company Aqua America.

CPPIB, which manages the C$368.3bn (€245.51bn) funds of the Canada Pension Plan, is buying close to 21.7m newly issued Aqua shares for an undisclosed stake in the listed utility firm.

In October last year, Aqua America announced it will acquire natural gas provider Peoples in $4.28bn deal, which includes the assumption of $1.3bn of debt.

Aqua America said today that the CPPIB investment marks an ”important step in obtaining permanent financing” for the pending acquisition of Peoples.

Aqua America chairman and CEO Christopher Franklin, said: “CPPIB’s investment in Aqua is an impactful contribution toward closing our acquisition of Peoples.

“This investment positions us well as we look ahead to completing the permanent financing for the Peoples acquisition, and we appreciate CPPIB’s commitment to this transformational endeavour.”

Deborah Orida, senior managing director and global head of active equities, CPPIB, said: “We are pleased to partner with Aqua America to support the revitalisation of this key infrastructure.

“By acquiring Peoples, Aqua America will create a unique platform with a strong management team that is poised for further expansion.”