Two UK water companies were the subject of takeover deals yesterday worth a combined £2.9 billion.
The biggest move involved Anglian Water owner AWG, which is set to change hands for £2.2 billion in a takeover led by the asset management arm of Commonwealth Bank of Australia and also involving 3i of the UK.
But there is also other interest and it is possible a bid battle will break out.
In a separate development, South East Water also attracted Australian investors following a takeover deal valuing the business at £665.4 million.
The company is being purchased by the infrastructure funds Hastings and the Utilities Trust of Australia, who currently own Mid Kent Water.
South East Water supplies drinking water to 1.5 million people, including in Sussex, Surrey and Hampshire.
The purchase of the business is subject to a mandatory review by the Competition Commission, which is expected to last around six months.
The offer for AWG, which owns Kidderminster-based process engineers Purac, is being made by a consortium taking the name Osprey and comprising Canadian, Australian and British firms.
The investment group comprises Canada Pension Investment Board, Colonial First State Global Asset Management, an asset management division of Commonwealth Bank of Australia, Industry Funds Management and 3i.
"We are long-term investors and we are looking forward to supporting management's strategy of concentrating on delivering first-class service to customers and on its regulatory obligations while seeking further operating and capital expenditure efficiencies," the consortium said.
Its offer is subject to the approval of shareholders, but has secured the recommendation of the company's board.
AWG chairman Peter Hickson said the proposal was 14 per cent more than the company's share price at the time it said it had received an offer last month.
It is also 295 per cent higher than the share price at the start of 2003.
Shortly after confirming the agreement with the consortium, AWG revealed it had received other takeover approaches. It said: "There can be no certainty that an offer will be made by any of these third parties and any offer that is made by a third party will be considered by the board at that time."
AWG said that in the meantime it reiterated its support for the 3i-backed consortium.
The utility company is one of the UK's largest water operators, serving around 5.4 million customers in the East of England and Hartlepool.