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Wessex Water for sale following Enron collapse

NEWS

WATER AND wastewater company Wessex Water was put up for sale this week as its owner, US energy giant Enron, filed for bankruptcy over the weekend.

Enron applied for protection from its creditors in the US under Chapter 11 bankruptcy laws following a series of profit warnings.

The European arm of the firm, of which Wessex is part, is now in administration under accountant PricewaterhouseCoopers.

This week, Wessex Water managing director Colin Skellett said that the £1.4bn water company's services and investment plans would be unaffected by Enron's collapse.

This is due to water regulator Ofwat's insistence that Wessex be given its own ring- fenced management and finances when Enron bought the company in 1998.

Wessex's immediate owner Azurix - a subsidiary of Enron - is looking for a buyer, said Skellett. He added this was likely to be a financial buyer such as German bank West LB, Barclays or Abbey National. 'They'll want to invest in a safe, reliable low yield water company, ' he said.

Skellett added it is unlikely that Wessex will be bought by a strategic water buyer such as Vivendi because it is too small.

It is also unlikely that Wessex will merge with another UK water company, he said, as the sale would be held up by referral to the competition authorities.

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