Pennon Rises Most Since November Amid Abu Dhabi Takeover TalkLouise Downing
Pennon Group Plc rose the most in four months in London trading after the Daily Mail reported that state-owned Abu Dhabi Investment Authority may bid for the U.K. waste and water company.
The stock gained 4.1 percent to 650.50 pence, the biggest advance since Nov. 29, after the newspaper said the Abu Dhabi group may offer as much as 24 percent more than yesterday’s closing price. Pennon and ADIA declined to comment.
While water utilities offer stable, low-risk returns backed by assets and linked to the Retail Price Index, Pennon is the least likely takeover candidate of the U.K.’s three biggest publicly traded water companies, John Musk, an analyst at RBC Capital Markets, said by e-mail.
About 40 percent of Pennon’s operations are in waste management. The largest publicly traded water companies in the U.K. are United Utilities Plc and Severn Trent Plc.