WET News

WET NEWS WATER AND EFFLUENT TREATMENT NEWS News+ WFD targets will be missed due to water contaminants, p4; what will a merger between Carillion and Balfour Beatty mean for the water sector, p6 Onsite: Water resource planning We take a look at Anglian Water's new £44M Hall WTW, and what makes it 'the most innovative ever constructed', p10 Insight: IT & telemetry Can Google Glass technology help utility contractors improve e… ciencies as well as health and safety, p22 Foresight: Have your say on whether an independent infrastructure commis- sion could tackle water and wastewater issues, p32 "...it is a fundamental piece of infrastructure that's needed for London, and some- thing that will provide a tremendous legacy for many generations to come" Phil Stride, P9 "We will dramatically accelerate our strategy of creating an integrated delivery platform with superior capabili- ties..." Michael Burke, p2 Infrastructure giants Carillion and Balfour Beatty have announced they are discussing a possible merger. The news sent their shares soaring. U nited Utilities (UU) and Dŵr Cymru Welsh Water's (DCWW) have both announced their capital delivery partners for AMP6 and, potentially, beyond. Skanska Construction UK working with Hyder Consulting (UK), Mott Macdonald Bentley, and Morgan Sindall, working with Arup, are the successful bidders to deliver part of DCWW's £1.5B AMP6 programme, with Galliford Try Infrastructure, working with AECOM, as reserve capital partner. The companies will work collaboratively in DCWW's new Capital Delivery Alliance. Their contracts cover 2015 to 2020, with an option for a further ' ve years. The contract is worth £25M a year to Morgan Sindall. Bill Gi' ord, Morgan Sindall's water director said: "We are very pleased to be continuing our successful partnership with Welsh Water and look forward to starting work on the new projects next year." UU's construction delivery A s WET News went to press, water industry eyes were on infrastructure giants Balfour Beatty and Carillion fol- lowing the shock announcement of a possible £3.05B merger. It is not clear at this stage what the implications will be for both companies' water interests should a merger between the two be consummated. News of the merger talks saw both companies' shares increase – Carillion's rose around 12% and Balfour Beatty's were up 11% [Check FT]. Balfour Beatty's water opera- tions cover the whole lifecycle of networks, including clean and wastewater mains, metering, treatment facilities and other essential infrastructure. The company announced last month that its joint venture with MWH had been chosen as a con- struction delivery partner for United Utilities' AMP5 capital investment programme. Carillion's water expertise is in network repair and maintenance, strategic pipelines, distribution T he Scottish government is considering adopting a multi- utility regulator covering electricity, gas and water if the country's vote next month for inde- pendence proves successful, a re- port by the Expert Commission on Energy Regulation has revealed. In the Main Report, the com- mission said a multi-utility regula- tor is an approach adopted by many smaller nations, and "it makes sense in Scotland". It said the model can provide greater con- sistency of approach as well as achieve synergies where sectors have much in common, such as networks. The commission added that there are working European models for combined regulation of single electricity and gas markets across EU member state boundaries. ECER chair Robert Armour said: "A multi-utility regulatory model makes sense for smaller nations. An independent regulator that is credible and able to respond to periods of stress while providing a consistent regulatory approach to underpin a stable investment cli- mate is important for any nation and particularly so given the prom- inence of energy in the Scottish economy." JVs get the lion's share of AMP6 contracts partners are C2V+ (CH2M Hill and VolkerStevin); MMB; Advance (Balfour Beatty and MWH); and LiMA (Laing O'Rourke and Imtech, with support from Atkins). The engineering services contract has gone to Jacobs UK. Commenting on Advance's success, Balfour Beatty Gas & Water managing director Craig McGilvray said: "We're very pleased to be an integral part of United Utilities AMP6 cycle with our partners MWH, and look forward to working collaboratively with the other framework partners to drive e© ciencies and 'best in class' customer service to support United Utilities to be a leading North-west service provider and one of the best UK water and wastewater companies." MWH Treatment managing director Rolfe Nuttall said this "is a fantastic opportunity for MWH and Balfour Beatty to bring our complementary capabilities" to the United Utilities programme. Carillion and Balfour Beatty in merger talks mains and « ooding works. Both companies said their hands were tied by Takeover NEED TO KNOW Balfour Beatty sacked its chief executive, Andrew McNaughton, in May this year Last month Balfour issued a pro• t warning, the fourth in two years A merger between Carillion and Balfour would create a £3B infrastructure group Goldman Sachs is advising Balfour Beatty and Lazard is advising Carillion. Richard Howson is favourite to head to combined group if a merger goes ahead Scotland considers multi- utility regulator AUGUST 2014 Volume 20 • Issue 08 IPS Flow Systems Tel: 0191 521 3111 www.ipsflowsystems.com The UK's leading supplier of plastic piping systems PVCu PVCc ABS HDPE PP PVDF Ex-stock, overnight delivery throughout the UK Panel restrictions and they could not comment beyond their state- ment to the Stock Exchange. In the statement, the parties said the discussions were "preliminary". They said a merger had the potential to create a market-lead- ing services, investments and construction business of "consid- erable depth and scale." Work was now under way to develop a strategy and outline business plan for a combined entity, underpinned by the evalu- ation of achievable synergies, future ' nancing arrangements and several other "essential sup- porting workstreams," they said. "In evaluating the merits of the merger, the two boards will, inter alia, wish to be satis' ed that such a merger would lead to very signi' cant value creation for the bene' t of both sets of shareholders." It is strongly speculated that Richard Howson, Carillion's chief executive, will run the combined organisation should the merger materialises.

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