Glas Cymru, the owner of Dwr Cymru Welsh Water in the UK, has raised US$180M in a lease back on its water and sewerage assets. The deal will be offset against the US$1.8B that Welsh Water will spend during 2002-2005 on its capital investment programme to improve environmental quality and customer standards.

The deal has been struck with the leasing subsidiary Lombard of the Royal Bank of Scotland Group. In financing its assets through leasing and long-term low-risk bonds, Welsh Water can cut its annual financing costs by around US$75M a year. This is important as Welsh Water does not have any shareholders and any surpluses it has are used to benefit its existing customers.