French group Vivendi has agreed to buy Southern Water, it was announced today.
Vivendi Environement will hold a ten per cent share of the water market in England and Wales after the acquisition, which values Southern Water at £2.05bn.
The deal, which still requires regulatory approval, has been struck with First Aqua, the holding company which bought the Southern Water business from ScottishPower in March.
Vivendi subsidiary Vivendi Water UK will now spend £420 million on the business, with the remainder coming from "financial partners".
Southern Water supplies a million homes in Sussex, Kent, Hampshire and the Isle of Wight.
It was put up for sale last year as part of Scottish Power's focus on the energy sector.
Vivendi said it hoped the acquisition could be completed by the end of this year.
The deal will automatically be referred to the Competition Commission because Vivendi Water UK already has water interests in the UK.
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