Locals lose out as Severn Trent's Dee Valley Water takeover gets the go-ahead from the High Court

 
Rebecca Smith
The water company's takeover has made a splash with locals...
The water company's takeover has made a splash with locals... (Source: Severn Trent)

Locals' attempts to thwart the takeover of a Welsh water company have failed after Severn Trent's bid to pick up Dee Valley Water has been given the go-ahead in the High Court.

The court decided the £84m deal by the FTSE 100 firm, initially agreed on back in November, could go ahead. However, it adjourned until 10 February pending any application to appeal, so the scheme won't become effective until then.

Dee Valley has said it will make a further announcement "in due course".

The David versus Goliath-style battle had been driven by some staff and customers who opposed the deal over concerns for jobs and bills.

Dee Valley Water employs around 180 people and has 230,000 customers across the Wrexham and Chester areas.

Read more: Severn Trent is set to beat forecasts despite "unpredictable" winter months

Before shareholders of the Wrexham-based firm met to vote on the prospective takeover, around 445 individuals, locals and employees, had shares transferred to them, in an effort to keep the takeover from going ahead.

The shareholders who objected the proposed takeover said they were "disappointed with today's decision" and are "currently considering the judgement and a possible appeal".

They believe that the best interests of both the firm and its shareholders are best served by Dee Valley "remaining as an independent water supply company".

Under the Severn Trent scheme of arrangement, the deal required approval 75 per cent of the volume of shares – easily obtained, with support from big institutional investors like Axa and Aviva – but also from a majority of individual shareholders.

Read more: Severn Trent is set to beat forecasts despite "unpredictable" winter months

Overall, 363 shareholders representing 87 per cent of the total volume voted in favour of the deal, while 466 investors representing 13 per cent of shares said no to the transaction.

Last month, the Dee Valley board said in a statement that it is “determined to ensure that the outcome of the [vote] properly reflects the views of our shareholders, that the process has been completed in a far and proper way, and that there will be no uncertainty as to how votes should be recorded”.

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