Ontario Municipal Employees Retirement System, Toronto, will invest in U.K. Thames Water through its infrastructure investment manager, Borealis Infrastructure.
The C$85 billion ($63.5 billion) Canadian pension fund, together with the $592 billion Kuwait Investment Authority's infrastructure investing arm, Wren House Infrastructure Management, agreed to purchase a 26% stake in the holding company of Thames Water Utilities, Kemble Water Holdings, from Macquarie Infrastructure and Real Assets, said a news release.
Macquarie European Infrastructure Fund 2 held the majority of the sale interest and is divesting its stake as the fund is approaching maturity, Macquarie said in a separate release.
The deal is expected to close by the end of the second quarter. Sources familiar with the matter said the business was valued at £12.5 billion ($15.4 billion) as of Sept. 30. Nomura International and Macquarie Capital advised Macquarie on the sale.
“Thames Water is the U.K.'s largest water company, a crucial provider of public utility services to almost a quarter of the U.K.'s total population. The geographical area the company serves is amongst the most densely populated and economically vibrant in Europe and Thames Water's commitment to deliver high-quality customer service and value for money will receive our full support,” Ralph Berg, executive vice president and global head of infrastructure at OMERS Private Markets, said in the OMERS news release.
The new investors will support Thames Water's ongoing £4.5 billion capital investment program until the end of the current regulatory period in 2020, OMERS said in its release.