Vol 13, Issue 6 (June 2012)
Need to know
- FLAGGING SALES
Sacyr Vallehermoso has given the clearest signal yet that it is willing to consider a sale of its environmental services division, Valoriza.
- YARD SALE
Veolia’s attempts to step up its asset disposals programme seem to be losing steam.
- SINKING THE ARMADA
The regional authorities in Madrid have put the sale of Canal Isabel II on ice.
- GULF ACTION
Saudi Arabia’s new economic cities are back on the agenda, with planners trying a change of tack to get things moving at the long-awaited Jazan and King Abdullah Economic Cities.
- MEMBRANES IN CHINA
The Chinese government has announced plans to develop a RMB100 billion-a-year ($15.9 billion) domestic membrane industry by 2015 – more than tripling the size of the sector as it stands today.
- Reasons to be hopeful
Christopher Gasson is not daunted by the recent bad economic news.
- David Lloyd Owen - Unlike much of the media, people continue to have practical concerns.
What is the purpose of a water and / or wastewater utility?
- CHART OF THE MONTH - Financing methods for US water and wastewater utilities
This month’s chart, from Black & Veatch’s report Strategic Directions in the U.S. Water Utility Industry, illustrates the willingness of US water and wastewater utilities to adopt alternative financing methods to fund infrastructure capex.
- IFC diversifies its water lending strategy
A step change in its origination effort has meant the World Bank’s private sector arm is pursuing a greater range of opportunities than ever before. Global water boss Usha Rao-Monari spoke to GWI about what lies ahead.
- More than just training
Emma Welsh introduces the first business insight seminar from GWI.
- Sacyr showcases its water business
Valoriza Agua is the fastest growing division within Sacyr. With an enterprise value of €470 million, can the group afford not to sell its most prized asset?
- Águas de Portugal maps out its future
The merger of bulk and retail water services in Portugal will result in a series of private concessions being rolled out next year. Not everyone is happy with the reform process.
- UK results show return to stability
The second year of the current pricing regime saw a modicum of stability return to the UK water and sewerage companies. Full regulatory disclosures next month will reveal the true extent of the bad debt situation.
- BT pays up for a seat on Thames’ board
The prospect of a seat on the board of the UK’s largest water utility is likely to have resulted in an attractive exit price for two of Macquarie’s infrastructure funds.
- Saur president faces tough task
The expiry of Séché’s call option on Saur last month has created something of a stalemate between the two companies. Saur’s new president Michel Bleitrach has his work cut out to resolve the situation.
- Degrémont reshapes its industrial business
The merger of Ondeo Industrial Solutions into Degrémont reunites all the industrial water expertise in the Suez Environnement group under one banner. CEO Rémi Lantier explains the rationale behind the move.
- EC renews calls for Czech water regulator
Czech water utilities face the threat of reduced EU funding unless an independent sector regulator is established. The move could spur consolidation in the industry.
- Making a credible water pricing proposal
George Day spent 12 years at Ofwat, the economic regulator for England and Wales’ water and sewerage utilities. Here he offers some thoughts for water utilities on how to justify pricing proposals.
- Write-offs complete the clean-up at Ovivo
GLV shares lost nearly 30% of their value after the company announced its full-year results this month. Lower sales, lower profits and big write-offs in the Ovivo water technology subsidiary were to blame.
- Crunch time for Culligan Man
A new lawsuit is threatening to derail the restructuring of the filtration specialist. What are the implications for other highly levered companies?
- Saudi opens up new city utility plans
Two new cities on the Kingdom’s west coast struggled to pin down utility investors during the financial crisis. A new open bidding process for city-wide concessions is a bold move – but brings a host of new problems.
- Doosan settles Barka dispute with SMN
The firm has reached an amicable settlement over the Omani IWPP. It can now turn its eyes toward Saudi Arabia.
- Degrémont confirms Samra expansion
The French company has put pen to paper on the expansion of Jordan’s largest WWTP after nearly three years of negotiation. Improved borrowing conditions allowed it to refinance the project’s existing debts at the same time.
- HSBC named as advisor on Mirfa IWPP
The contract to advise on Abu Dhabi’s latest IWPP is another feather in the cap for the bank’s project finance team in the Middle East. Technical challenges mean procurement may not be a straightforward matter.
- New cities, new methods
Planners are considering the possibility of full water and wastewater concessions in two new Saudi cities. What are the potential pitfalls?
- Itochu casts itself in a new mould
Recent deals in the UK and India have seen the Japanese trading house expand its traditional role in the water market. It is eyeing up to $1 billion of investment in the sector over the next five years.
- Moving in for the 3 million m3/d merger
Salcon is ramping up its acquisition activity in anticipation of hiving off its Chinese project portfolio. Executive director Eddy Leong spoke to GWI about his ambitions.
- The Holy Grail of infrastructure investing
A new pan-Asian fund will leverage money from regional governments and the ADB to support infrastructure projects. Its risk profile means it will stop short of investing equity itself.
- Darco emerges from the dark
The troubled project developer released an encouraging set of 2011 results on 30 May. Doubts remain over its ability to continue as a going concern.
- Dining at the chaebol table
Charles Bodhi investigates the mystical relationship between big Korean industry and government.
- Separating the vision from the reality
The Chinese government’s near-term ambitions for its domestic membrane industry make sobering reading for international suppliers. What are the challenges?
- KEC International narrows its water focus
The water business of India’s RPG Group has more closely defined the areas in which it intends to play. CEO Dilip Shukla sees a big future in wastewater management.
- Australia’s CSG water market shrinks overnight
New figures outlining the average volumes of produced water which will need to be treated in Australia’s CSG industry might suggest limited opportunities for treatment specialists. Equipment supply is only part of the story.
- EUROPE WATER IN BRIEF
OHL has completed the sale of its environmental division Inima to GS Engineering & Construction and Copainima, a Korean pension fund, for an equity value of €231 million, netting the group a €43 million capital gain.
- Americas Water IN BRIEF
A new survey by Black & Veatch has found that over 31% of US water and wastewater utilities are considering the use of public-private partnerships.
- MIDDLE EAST WATER IN BRIEF
Minority shareholders at developer International Power have approved a £6.4 billion ($10 billion) share buyout by GdF Suez.
- ASIA WATER IN BRIEF
The consolidation continues among international environmental consultants, with Lahmeyer announcing the purchase of a 70% stake in Philippines-based water and energy consultancy IDP Consult earlier his month.
GWI Water Index
- Water stocks leave broader market behind
Contagion-resistant water utility stocks were the best place to be this month, as the GWI Water Index outperformed major stock indices on every continent. Declines elsewhere were a catalyst for increased share buyback activity.
- Desalination and reuse for oil and gas: The energy-water-money nexus
The demand for water technology in the energy sector is set to grow steeply, but with cheap gas and expensive oil, the nature of the opportunities is changing rapidly. This preview of one section of GWI’s latest report shows how.