Dutch asset manager PGGM is buying a 20% stake in the US water business of France-based multinational utility group Suez for $601m (€512.7m).

The €215bn asset manager said its infrastructure fund has agreed to acquire the stake in Suez Water Resources, a company specialised in regulated water activities.

Erik van de Brake, head of infrastructure at PGGM: said: “This is a rare investment opportunity and it fits nicely into our portfolio. The water utilities are operating under transparent and stable regulatory regimes.

“We support the ambitious investment strategy of Suez. This investment will provide our clients like Pensioenfonds Zorg en Welzijn with attractive and stable long-term returns.”

Suez Water Resources provides 2.1m people with water in New Jersey, New York, Idaho, Pennsylvania, Delaware en Rhode Island.

The transaction is expected to be completed by first-half 2019, subject to customary regulatory approvals.