EUROPE WATER IN BRIEF

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Dutch engineering consultants DHV and Royal Haskoning have announced their intention to merge, in order to create a €700 million-a-year powerhouse.

The move comes as other European consultant engineers undergo restructuring initiatives to try to restore profitability: Grontmij announced a major reshuffle on 9th March, while Pöyry has sold its lossmaking international water business to Lahmeyer (see story p17).

 
Having previously teamed up with Remondis to bid for the SEDIF contract renewal, French services company Derichebourg formally launched its water division, Derichebourg Aqua, at the start of this month.
 
It faces a potentially difficult battle in its bid to tender for water services contracts in France: the Lyon Urban Council voted in February to curtail a €125 million-ayear contract almost two years before its scheduled expiration. Veolia accounts for 85% of the contract’s revenue.
 
Meanwhile, hostility between Saur’s senior management and 33% shareholder Séché Environnement has reached a new level, after group chief Joël Séché – who is also president of Saur – filed a lawsuit against Saur International for embezzlement.
 
Thames Water’s $750 million US private placement, completed in late February, took advantage of a closing arbitrage window which is understood to have offered a compelling funding advantage versus where the company could have raised similarly-dated sterling debt. The deal, structured by HSBC and Morgan Stanley, was split into three Class A tranches with maturities of 10, 12 and 15 years, and a 7-year Class B leg.
 
Anglian Water, meanwhile, has been buying back portions of its 7.882% Class B bond on the open market in order to reduce the cost of carry. The company has already repurchased £56.7 million of securities – more than 20% of the outstanding amount – ahead of a call date in July.
 
The Spanish government has revealed that it anticipates being fined up to €50 million per year by the European Court of Justice for failing to implement the EU directive on urban wastewater adequately