£600m payday for AWG investors

WATER group AWG's plans for a bumper pay day for its shareholders remain firmly afloat after it raised £1.76bn of debt on the bond market.

The group wants to return up to £600m to investors under a financial restructuring designed to ringfence its core regulated water business.

And it has shrugged aside concerns it may not be able to raise enough debt to finance the move by revealing it had actually secured more than expected.

Anglian Water Services, which supplies 5m homes with water, will be funded by the £1.76bn-worth of debt under the restructuring.

Shareholders will instead hold a smaller stake in a slimmed-down business focused on AWG's deregulated support services operations. In return for the dilution in their stake, Huntingdon-based AWG will return between £400m and £600m to shareholders in cash.

Plans for the cash return will be outlined at the end of the month but an AWG spokesman would not be drawn today on how much may be paid out.