Dutch pension fund acquires 20% stake in US water utility SUEZ Water Resources

Erik van de Brake, PGGM, Head of Infrastructure

SUEZ Water Resources Inc. has signed an agreement to sell a 20 percent stake for $601 million in its United States regulated water business to Dutch pension fund PGGM.

The acquisition by the PGGM Infrastructure Fund, which includes fifteen regulated water utilities, mainly concentrated in the Northeast region of the United States, will help strengthen SUEZ’ balance sheet again following last year’s acquisition of GE Water.

SUEZ Water Resources is an American subsidiary of French waste and water group SUEZ and provides 2.1 million people with water in New Jersey, New York, Idaho, Pennsylvania, Delaware en Rhode Island. The operations make SUEZ Water Resources one of the biggest private water companies on the territory.

With the acquisition which is subject to approval from local regulators by the first semester of 2019, the PGGM Infrastructure Fund substantially expands its investments in water infrastructure.

Commenting on the acquisition, Erik van de Brake, head of Infrastructure at PGGM said:

This is a rare investment opportunity and it fits nicely into our portfolio. The water utilities are operating under transparent and stable regulatory regimes. We support the ambitious investment strategy of SUEZ. This investment will provide our clients like Pensioenfonds Zorg en Welzijn with attractive and stable long-term returns.’’

For PGGM the investment in SUEZ Water Resources qualifies as an ‘investment in solutions’. PGGM is aiming to invest € 20 billion in 2020 with tangible and positive impact on four themes: clean water, food security, climate and health care.

The cooperative Dutch pension fund service provider had €215 billion in assets under management and was administrating pensions of 4.2 million participants as at June 30 2018.