The Universities Superannuation Scheme, London, has increased its stake in Thames Water, making it the £82.2 billion ($109.5 billion) pension fund's largest single investment.
USS announced the additional 8.8% stake purchased from Wren House Infrastructure Management on Dec. 3.
Thames Water is the U.K.'s largest water and wastewater company with 15 million customers. USS began investing in it in 2017, and it said in the release that enhancing its position to nearly 20% matches well with its long-term investment outlook.
USS didn't disclose how much it acquired the stake for or what its 20% holding is worth.
Thames Water faces several challenges, including aging infrastructure and climate change. It has plans for £10.7 billion of improvements and expansion over the next five years. It has also committed to be net-zero by 2030 and carbon negative by 2040 through reduced emissions and increased renewable energy generated. It recently enhanced its board and brought in a new executive leadership team.
"Thames Water has some key challenges to overcome in the coming decades. Real progress has been made but customers and the general public quite rightly expect more. This will require hard work and further substantial long-term investment," said Mike Powell, USS head of private markets, in the release.
USS is one of the U.K.'s largest pension funds. With this latest investment in Thames Water, 45.8% of its assets are now invested in the U.K., heeding a call by government officials for pension funds to help spur an economic recovery.
"As an investor with liabilities denominated in sterling, the U.K. is a natural home for our investments and we want to put money to work to meet our pension promises," a spokeswoman said in an email.