USS makes Thames Water its biggest stake

The Universities Superannuation Scheme in London increased its stake in Thames Water, making it the pension fund’s largest investment of £ 82.2 billion ($ 109.5 billion).

USS announced the additional 8.8% stake purchased from Wren House Infrastructure Management on December 3.

Thames Water is the UK’s largest water and wastewater distribution company with 15 million customers. USS began investing in it in 2017, and it said in the statement that improving its position to almost 20% matches its long-term investment outlook.

USS did not disclose how much it purchased the stake or how much its 20% stake was.

Thames Water faces several challenges, including aging infrastructure and climate change. It plans £ 10.7bn of improvements and expansion over the next five years. It also pledged to be net zero by 2030 and carbon negative by 2040 through reduced emissions and increased production of renewable energy. It recently strengthened its board of directors and put in place a new management team.

“Thames Water has key challenges to overcome over the coming decades. Real progress has been made, but customers and the general public rightly expect more. It will take hard work and other substantial investments over the long term, ”said Mike Powell, USS director of private markets, in the statement.

USS is one of the UK’s largest pension funds. With this latest investment in Thames Water, 45.8% of its assets are now invested in the UK, responding to a call from government officials for pension funds to help spur an economic recovery.

“As an investor with liabilities denominated in pounds sterling, the UK is a natural hotbed for our investments and we want to make the money work,” spokeswoman Lucinda Kemeny said in an email. “We look forward to playing an active role as the UK’s leading infrastructure investor. “

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