Business

Severn Trent expands green arm with £120m buyout

West Midlands utility has acquired Agrivert which specialises in generating energy from food waste

Liv Garfield, chief executive of Severn Trent Water

West Midlands utility Severn Trent has acquired green energy firm Agrivert Holdings and its UK operating businesses for £120 million.

Founded in 1994, Agrivert UK is a specialist in renewable energy generation from food waste and has a string of anaerobic digestion plants and waste composting sites in the South of England and Wales.

It processed more than 310,000 tonnes of solid organic waste in 2017 and has long-term contracts with local councils and 20-year renewable energy subsidies backed by the Government.

Agrivert's UK operations will be added to Severn Trent's existing Green Power business and its plants will complement the division's two food waste plants in Coleshill and Roundhill, near Stourbridge , and a third site under construction in Derby.

Severn Trent said the purchase of Oxfordshire-based Agrivert UK will take its investment in energy and renewables to approximately £300 million by 2020.

Liv Garfield, chief executive of Coventry-based Severn Trent, said: "We're delighted to welcome Agrivert UK into the Severn Trent Group.

"Renewable energy is strategically important to Seven Trent and the UK as a whole as we work towards achieving our decarbonisation targets and delivering attractive shareholder returns.

"Agrivert UK strengthens our established presence in anaerobic digestion where we have been leaders in the water sector for many years.

"We have worked in partnership with Agrivert UK on a number of projects in recent years and have been hugely impressed by their engineering capability and expertise."

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Agrivert's chief executive Alexander Maddan added: "As we finalised the latest expansion of our anaerobic digestion fleet, it was a natural juncture to create an even more competitive business by combining Agrivert UK with the Severn Trent Group.

"Our familiarity with the Severn Trent Group gives us great confidence that the Agrivert UK business is being transferred into good hands, allowing Agrivert Ltd to concentrate on the engineering and overseas markets."