Hermes Investment Management (“Hermes”), the £24.1 billion manager focused on delivering superior, sustainable, risk adjusted returns to its clients – responsibly, has today announced that its infrastructure team has acquired an additional 17.1% ownership stake in Southern Water on behalf of clients. This takes Hermes’ overall managed ownership interest to 21%.
Following announcement of the sale of Future Fund’s stake earlier in the year, Hermes has worked collaboratively with multiple parties in order to ensure a positive transaction outcome. Southern Water is responsible for a region encompassing Hampshire, the Isle of Wight, Kent and East and West Sussex, supplying water to over 2.4 million people and wastewater services to 4.6 million people. The company operates across the entire water and sewerage spectrum and is the seventh largest supply and sewerage company in England by regulated capital value.
Peter Hofbauer, Head of Infrastructure, Hermes Investment Management, said: “We are pleased to have acquired this additional ownership interest in Southern Water, obtaining incremental governance rights, including board representation, on behalf of our clients. We look forward to continuing to work with the company, Board, Management, Customers and other key stakeholders going forward.”
Hermes held a final close in May 2015 for the Hermes GPE Infrastructure Fund (the “Fund”) and its related accounts (together,”HIF”). HIF raised a total of £1.16bn (USD1.8bn; EUR1.6bn)**, exceeding its £800.0m (USD1.3 EUR1.1bn) target. The Hermes infrastructure team now manages funds of £3.9bn (USD6.1bn; EUR5.4bn)***, including a £2bn (USD3.1bn; EUR2.8bn) direct investment managed account programme for the BT Pension Scheme, one of the UK’s largest occupational pension schemes. In March 2015, Hermes announced its intention to acquire stakes in Eurostar, the high-speed rail service and Associated British Ports, the UK’s leading ports group in consortium with Caisse de dépôt et placement du Québec (CDPQ) and Canada Pension Plan Investment Board (CPPIB) respectively. Both transactions completed in 2015.
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