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Enron buys UK water firm
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July 24, 1998: 10:50 a.m. ET
U.S. energy company acquiring Britain's Wessex Water for $2.2B
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NEW YORK (CNNfn) - Enron Corp. said Friday it has agreed to acquire Britain's Wessex Water PLC for about $2.2 billion cash, marking its entry into the global water utility business.
Enron, a Houston-based natural gas and electricity concern, said it is forming a new water subsidiary that will own and operate strategic water and wastewater assets, such as local distribution systems and treatment facilities, and develop related infrastructure.
The company said Wessex will be the flagship of the new subsidiary.
"Currently, there are only a handful of large private sector companies operating in the $300 billion worldwide water market, and there are tremendous opportunities for future growth as the water industry moves toward privatization and consolidation," said Kenneth Lay, Enron chief executive officer.
Enron said its new water subsidiary initially will pursue development of water projects in Europe, Latin America and Asia.
Lay said Enron expects the deal to add to Enron's earnings in the first full year of operations.
"We expect the new water company to be able to finance its own ongoing activities rather than depend on Enron's financial resources," Lay said.
Wessex Chairman Nicholas Hood will be vice chairman and a director of the new water company. Rebecca Mark, Enron vice chairman, has been appointed chairman and CEO of the subsidiary.
Enron (ENE) shares shed 1/4 to 56-1/4 in early trading. 
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Enron
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