The Welsh water and electricity supplier, Hyder, has agreed to
a £402M takeover by Nomura International, the Japanese investment bank. No other offer to take over Hyder in
its entirety was made, although Southern Company and Penn -sylvania Power & Light,
US owners of South West Electricity, considered bidding for Hyder’s power distribution business.
The takeover of Wales’ largest private sector employer is politically sensitive, but Nomura has promised to keep the group headquarters in Cardiff, east Wales. Guy Hands, managing director of Principal Finance said that the first priority was to sort out Hyder’s £1.9B of debt.
According to a report in
the UK’s Financial Times, Ian Turner, an analyst at Deutsche Bank, said: ‘Hyder has a
regulated asset base of 460p
a share so Nomura has got
a good deal. After Nomura
stops paying a dividend, it
will only need about £50M a year to keep Hyder ticking over. It could cover that by
efficiencies, cutting capital expenditure and disposing of non-core assets.’
Nomura will avoid problems with competition authorities because it has no other
water or electricity interests. Analysts believe that this probably deterred other utilities from bidding.