THE CONSORTIUM of investors bidding for Severn Trent withdrew their offer yesterday, after the utility firm refused to engage in negotiations before the deadline.
LongRiver Partners – comprising the Kuwait Investment Office, Borealis and the Universities Superannuation Scheme – had its third bid of 2,200p per share rejected on 7 June, after Severn Trent claimed it was not fair value.
It is understood the consortium felt it was unsustainable to keep bidding against themselves, and that Severn Trent had failed to show them where the extra value was by refusing to engage in talks. LongRiver must wait six months if it wants to make a fresh bid.
As City A.M. previously reported, a number of shareholders have backed Severn Trent’s rejection of the third offer, suggesting 2,300p per share would have been more acceptable due to the increasing scarcity of coveted utility assets.