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AWG may return £600m to shareholders
Written by Business Weekly   
Tuesday, 04 December 2001
AWG in Huntingdon, which owns Anglian Water, expects to return up to £600m to shareholders as it plans to refinance its water business largely from debt. AWG in Huntingdon, which owns Anglian Water, expects to return up to £600m to shareholders as it plans to refinance its water business largely from debt.

AWG, which reported a 40 per cent drop in interim pre-tax profits to £35.9m, intends to transfer all of its existing group debt of around £2.6bn to its regulated water subsidiary.

The strategy of using debt to refinance should enable AWG to raise around £800m of fresh debt while earnings would be ringfenced to repay existing and new bondholders.

AWG’s profits tripled in international markets and the interim payment to shareholders of 13.42p is up 1.7 per cent.

Chief Executive Chris Mellor said: “We have had an exceptionally busy first half to the year.

“Naturally, we have spent much time and effort on our far-reaching restructuring plans.

“The Morrison businesses have performed well in the half, particularly Utility Services.

“Although we continue to deal with some residual difficulties presented by contracts taken on prior to acquisition, work taken on since September last year is profitable and presents a stable platform for future growth.

“The regulated business has also done well. Its performance provides strong foundations for our restructuring plans.

“These plans form a major step in the evolution of the Group - and one which is necessary if we are to continue improving the financial and operational performance of all our businesses.”
 
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