Southern Water has been put up for sale for around £4 billion pounds.
The company, which supplies Sussex and Hampshire, is being sold by the private equity arm of its owner Royal Bank of Scotland (RBS).
A company spokesman said: "Our ownership of Southern Water is under review as part of the normal course of business."
RBS wants to take advantage of soaring valuations in the sector, according to unnamed sources, the Times said today.
Deutsche Bank has been appointed to advise RBS on strategic options, including a possible sale, the newspapers reported, without naming sources.
Deutsche was not available for comment.
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