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Will Northumbrian Water be the next to fall foul to overseas prey?

Shares in Northumbrian Water increased by 12% today with speculation mounting about a possible offer by the company's largest shareholder, the Ontario Teachers Pension Plan. The pension fund already has a 27% stake in the business and is rumoured to be on the verge of announcing a £1.7 billion bid to take the company private. So is Northumbrian Water about to be the next UK utility company to fall into the hands of foreign prey?

The silence from the Ontario Teachers Pension Plan trustees was deafening today, further strengthening rumours of a bid in the short term. Northumbrian Water has been trading in line with market expectations with revenue for 2009/10 expected to be in line with the previous year. If these rumours in the market persist there is every chance that the Takeover Panel will approach the Ontario Teachers Pension Plan and ask the trustees to make an announcement about their intentions.

The UK utility sector is now dominated by overseas parent companies and there are now very few left with any real management presence in the UK. This has been a bone of contention for some time amongst UK consumers and UK businesses who continue to see their utility bills rise on an ongoing basis. Will the government dare step in if a bid is made for Northumbrian Water?

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