USSIM, the wholly owned investment management subsidiary of the UK’s second largest pension fund, the Universities Superannuation Scheme (USS), has announced that it will provide £100 million of 25 year inflation-linked financing to South East Water Finance Limited via the private placement of an index-linked note.
USS senior investment management for infrastructure, Gavin Merchant, commented on the deal: “Our team has spent a significant amount of time building strong relationships with a select number of core UK infrastructure companies. Our approach is very much focused on forming long term partnerships where we can provide flexible financing. We identified South East Water as a well run company with strong management, and are delighted that we could arrange an attractive financing package for the company and execute in a short period of time.”
South East Water is the second largest water-only service company in England and Wales, covering Kent, Sussex, Berkshire, Hampshire and Surrey, and it is ultimately owned by Utilities Trust of Australia, Caisse de dépôt et placement du Québec and Desjardins Employees Pension Fund. USS is a final salary pension scheme for universities and higher education establishments in the UK with assets of £34 billion. It has invested £1 billion in infrastructure to date, and intends to invest a further £2 billion in core infrastructure assets in the next three years, with a focus on the UK, Europe and Australia.