Severn Trent incurs $29 million costs after snubbing bids

Wed Jul 17, 2013 2:54am EDT
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LONDON, July 17 (Reuters) - British water company Severn Trent said it has incurred 19 million pounds ($29 million) in legal and advisory costs after it rebuffed bid approaches from a Canadian-led consortium.

The LongRiver consortium abandoned plans to bid for Severn Trent last month after the water utility spurned its multiple approaches and allowed a bid deadline to expire, disappointing hedge funds who bought its stock in anticipation that the deal would be sealed.

Severn Trent criticised the bid, which last valued it at $8.2 billion, as failing to reflect its long-term value or potential. The consortium comprised of Borealis Infrastructure , part of Canadian pension fund OMERS, a Kuwaiti sovereign wealth fund and Britain's Universities Superannuation Scheme.

Shares in Severn Trent closed at 1746 pence on Tuesday, valuing it at 4.15 billion pounds or $6.28 billion.

In a trading update on Wednesday, Severn Trent said trading across its group was in line with its expectations and prior guidance. It said customer prices in its water business rose by 2 percent from April 1.