Global Water Intelligence Magazine

Oct 16 cover

Vol 17, Issue 10 (October 2016)

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In Global Water Intelligence this month


Need to know


Points of use
  • US buyout specialist Advent International is understood to have closed its acquisition of water point-of-use specialist Culligan. The deal – said to be worth $900 million including...more
  • AquaVenture Holdings made a strong debut on the Nasdaq this month, with the shares rising from an offer price of $18 to more than $23 at the time of going to press, giving a market cap of $...more
Distress
  • A Chinese buyer has reached a deal to take over German membrane distillation specialist memsys. The business fell into bankruptcy over the summer after its principal shareholder, Skagen, withdrew funding...more
  • Sludge management specialist Therma-Flite also filed for protection from its creditors over the summer, but its main financial backer XPV is not looking for a buyer. Instead, the business...more
  • Rick Stover is rumoured to be leaving high-recovery reverse osmosis specialist Desalitech...more
African desal
  • Kenya’s second city, Mombasa, is looking for a developer to build three privately financed desalination plants with a total capacity of 270,000m³/d...more
  • Egypt’s desal programme is moving rapidly ahead, despite the fact that the authorities abandoned attempts to bring in private finance to deliver the projects earlier this year...more
  • Meanwhile in Namibia, the government has dropped plans to buy and expand Areva’s 50,000m³/d desal plant near Swakopmund. Instead, it will build...more
IPO time
  • The Paraná state government in Brazil is finalising plans to sell off part of its majority stake in state water operator Sanepar...more

  • American pipe manufacturer Forterra, Inc. was set to price its IPO as GWI went to press. The target is to raise up to $445 million of new money, reflecting a market cap in the region of $...more
Funny money
  • The Beijing government has awarded $3.5 billion of water and wastewater public-private partnership projects. The big winner was Beijing Enterprises Water Group, although the structure of the deals...more
  • China’s central government issued an order this month requiring all future wastewater and solid waste projects to be tendered as public-private partnerships. The idea is that...more
  • No news yet on whether China’s CCCC has been successful in its bid to acquire IDE Technologies. The Israeli desalter is, however, pressing on with...more
Frenchies
  • Suez has increased its stake in Italian multi-utility Acea to 23.3%, as the company prepares for the consolidation of the Italian market...more
  • Suez Ventures has taken a 22% stake in biogas purification and recovery specialist Prodeval. The deal reflects the maturity of the investment unit...more
  • Veolia North America has finally had a big win in the North American municipal contract ops market, after a four-year drought. It took the $110 million contract to run...more
Private water
  • An Australian “wet” water fund is raising A$63 million (US$48 million) of equity and debt with a promise to give some of the water it acquires for its portfolio back to...more
  • As UK utilities gear up for the opening of retail competition for non-household customers in April next year, ratings Moody’s paints a pretty bleak picture of the possible profitability of would-be market entrants...more

Project Tracker

Project Tracker

Charting the progress of over 900 Desal, Reuse and PPP water projects in the international water industry.

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Latest Tracker Updates

Project Tracker Database
(Subscription Requried)
PROJECT COUNTRY UPDATED STATUS TYPE
Hassyan SWRO... United Arab Emirates 21 Sep 18 The client has... Desal
Canoas WWTP Colombia 21 Sep 18 Proposals for ... Reuse
Lake Station... United States 20 Sep 18 The Indiana Ut... Utility
Sun Country ... United States 20 Sep 18 The bid submis... Utility
East Brandyw... United States 20 Sep 18 Sealed bids ar... Utility

What's making the news in global water projects this month

Project tracker

Tunisia launches emergency desal programme; Namibia and Kenya desal projects move forward; Chennai lines up mega-projects; California’s wastewater dilemma; Nicaraguan PPPs take shape; Atlantic City concession hopes fade away; all the latest project news from around the world.

Intelligence


GWI Water Index

Water market re-adjusts to a new valuation paradigm

Stocks with desalination exposure had a stellar month, while US regulated utilities appear to have bottomed out. How will US interest rates affect valuations going forward?


Water on the markets this month:

GWI IndexValueChangeDate
Global Water154.911.95%10 Aug
Asian Water98.010.41%10 Aug
EMEA Water91.372.17%10 Aug
Americas Water253.642.56%10 Aug

Market Profile

Digital transformations set to boost buoyant smart water market

Regulatory, economic and efficiency drivers are pushing utilities and industrial water users to explore smarter, data-driven solutions for water control and monitoring. A new report from GWI outlines the opportunities for players in the sector.

The smart guide to smart water

The integration of digital solutions with water technology is making a difference in an array of areas. What does GWI’s new research report cover?

The List

The top 50 BOT developers

Who has the largest portfolio of privately financed water/wastewater treatment plants?


 

Christopher gasson Insight from 50,000 feet

Christopher Gasson has been in Iran, the Netherlands, Australia, China, and Korea during the past month. What has he learned?


Chart of the month

Newly contracted global desalination capacity

This month’s chart comes from the 29th DesalData/IDA Worldwide Desalting Plant Inventory.


Chart of the month

Americas

Green infrastructure P3s start to take root in the US

The stormwater P3 model first deployed in Maryland in 2015 is generating interest among communities in other states. Is the market attractive enough for private investors?

DC Water issues performance bond

The utility’s new $25 million bond represents a unique attempt to manage the risks associated with green stormwater infrastructure projects.

Seawater desalination searches for traction in the Lone Star state

A tangible seawater desal project has yet to materialise in Texas. While industrial demand could drive progress, local political interests will need to be addressed.

Water pure-play AquaVenture charts a course towards profitability following IPO

The water-as-a-service company floated this month at a market valuation of $475 million. Although AquaVenture boasts promising cashflows, breaking into the black will require the asset-heavy business to continue bulking up.

Key unlocks new water equipment financing opportunities with Xylem partnership

Key Equipment Finance has entered into a formal partnership with Xylem to provide flexible financing options to the water equipment supplier’s customers in North America. Is there a role for lease purchasing in the limited repertoire of municipal funding options?

Sanepar shares rally as equity sale looms

The Brazilian state of Paraná is looking to offload part of its majority shareholding in the water concessionaire to raise cash. The shares are up 150% since the start of the year, but the company is still undervalued.

Debra coy Desal getting bigger in Texas

Desalination is set for a sea change in the Lone Star State, argues Amanda Brock.

Americas water in brief

Water and drainage pipe manufacturer Forterra, Inc. was due to price an IPO of up to $445 million as GWI went to press.


Asia pacific

China Minsheng to return UESH to the stock exchange via reverse takeover

United Engineers has completed the sale of its environmental engineering business, UESH, to a joint venture of China Minsheng and China Water Affairs Group director Liu Yujie. The new owners are reversing their new holding back onto the Singapore stock exchange.

Beijing government doles out $3.5bn Tongzhou water PPPs

BEWG has secured the bulk of Beijing’s latest slew of PPP projects, while Beijing Drainage Group and Beijing Capital were unsuccessful. The fierce competition is pushing IRRs to record lows, but the PPP-led build-out has driven reuse capacity to astonishing levels.

Water industry veteran beats politician to K-water top job

A K-water insider has won the post of CEO of the public corporation, despite a challenge from a well-connected politician. But while a new tariff increase will boost corporate independence, the government’s influence is still pervasive at home and abroad.

AMP Capital buys into Aussie desal

Australia’s AMP Capital has acquired a 5.2% stake in the country’s flagship water PPP. It sees more private finance opportunities to come in the sector.

Asia water in brief

Taiwanese water project developers Hsin Dar and CTCI have reached financial close on their Fengshan project, the first privately financed municipal wastewater reuse facility in Taiwan.

Impact investing with a difference as Aussie water fund looks to raise fresh capital

An Australian water rights fund believes it can educate investors to accept a lower return in exchange for an environmental benefit. Is it a zero-sum game?

Willy yeo Reversing into pole position

News of United Engineers’ reverse takeover helps make sense of last month’s aggressive bidding on Marina East, argues Willy Yeo.

China water in brief

Hong Kong-listed Shanghai Industrial Holdings has agreed to invest RMB1.23 billion ($183 million) to increase its stake in water project developer Longjiang Environmental Protection Group by 48%, to bring the group’s total stake to 90%.

Europe

Double share deal cements Suez’s position in Italy

An increased stake in Acea will boost Suez’s exposure to Italian utility consolidation. A partnership with new shareholder Caltagirone, meanwhile, brings a host of benefits.

Suez complements its biogas flowsheet with Prodeval equity investment

Having already collaborated on a number of commercial references, Suez has strengthened its relationship with biogas specialist Prodeval by taking a 22% equity stake. The deal leaves both companies free to explore commercial opportunities with competitors.

Divining the new colour of money

Suez Ventures’ latest investment showcases how far the platform has come since launching under the Blue Orange name back in 2010.

Eliquo Water establishes a municipal bridgehead in the UK with Hydrok acquisition

The German-owned EPC contractor has bolstered its nascent UK operation by buying an established equipment supplier and systems integrator with key commercial relationships. How will it cope with the market’s notoriously unpredictable spending patterns?

Quantifying the risks of UK water competition

With credit concerns threatening to stifle competition in a market with negligible net margins, what is the way forward for retail competition in the English water market?

Catalan water law reform could create fresh private sector opportunities

Returning responsibility for wastewater management to ill-equipped municipalities could pave the way for a new crop of private sector concessions. The success of the reform could hinge on government support from an anti-private sector minority.

David lloyd owen The price of resilience

Secure supplies will cost English customers dear, but effective management means effective metering, says David Lloyd Owen.

Europe water in brief

AIM-listed APC Technology Group has agreed to sell its water hygiene and treatment business to South Staffordshire plc for £1.8 million, just two years after having bought it for nearly £4.8 million.


Middle East and Africa

Getting the gnus across the river in Iran

Last month saw the holding of the first Iranian Water Summit in Tehran. Hundreds of delegates from government bodies and international and local water and wastewater companies met to thrash out the future of water in a post-sanctions Iran.

Abu Dhabi looks to bolster desal water supply options

Despite a prolific desalination building programme, water demand is soon set to outstrip supply in the emirate. The next major step for desal has been outlined.

Tom scotney Where to start with Iran?

A new market doesn’t mean Terra Nullius, says Tom Scotney – but GWI’s Iranian Water Summit shows where the gaps are.

Middle East water in brief

Following on from its decision to pursue more privately financed desalination projects as part of an overall strategic repositioning (see GWI September 2016 p34), Oman’s Public Authority for Electricity and Water has opened tendering for five small SWRO plants.

Tunisia launches emergency desal strategy

Low rainfall and a protracted procurement schedule for large-scale desalination plants have forced the Tunisian authorities to announce an emergency mobile desalination programme. Implementation is still likely to take the best part of two years.

Desal picks up steam in Egypt as Cairo aims to reduce Nile water dependency

New Metito contracts show desalination is taking centre stage as the country looks to shore up its drinking water supply.