Severn Trent bidders threaten to walk away

Suzie Neuwirth

THE CONSORTIUM of investors bidding for Severn Trent today said that they will not make a third takeover offer unless the utility firm engages in talks with them.

On Friday, the FTSE 100-listed water company rejected LongRiver Partners’ second offer of 2,200p, equating to £5.2bn.

Severn Trent said it failed to reflect the long term value and future potential of the company.

The consortium – comprising Kuwait Investment Office, Borealis and UK pension fund the Universities Superannuation Scheme – have a ‘put up or shut up’ deadline of tomorrow to make any final offers.

Commenting on behalf of the consortium, Michael Rolland, president and chief executive of Borealis, said: “Since we submitted our proposal on 14 May 2013, no member of the consortium or its advisers has met any of the directors of Severn Trent or its advisers, despite repeated requests.

“The Severn Trent board has shown no interest in discussing our pre-conditional offer with us. In the absence of any such engagement, there will be no further proposal from the consortium and no offer for Severn Trent shareholders to consider.”

Rolland added that the consortium would not put another offer forward “in the absence of meaningful engagement.”

Deutsche Bank and RBC Capital Markets are acting as financial advisers to the consortium.