City firms prepare for Dwr Cymru takeover

City firms are gearing up for a fight as Glas Cymru launches its second bid for Dwr Cymru (Welsh Water) with a £1.8bn offer financed wholly by debt.

US utility giant Western Power Distribution (WPD) agreed in principle on 3 November on the sale of its licensed water and sewerage business to Glas Cymru.

A 15-strong team at Linklaters & Alliance, led by financing partner Julian Davies and including corporate partner John Goodwin, is advising Glas Cymru.

The firm originally acted for Glas Cymru, a non-profit group led by Lord Burns, the former treasury permanent secretary, when it launched a bid for Dwr Cymru in July.

Allen & Overy (A&O) is reprising its role as adviser to WPD, which successfully fought off Nomura in September for control of Dwr Cymru's former parent Hyder.

A&O's corporate partners Mark Gearing and Michael Scargill are stepping back into the fray as lead partners on the bid.

Clifford Chance, which acted for Schroder Salomon Smith Barney as the lead financier on WPD's bid, is acting for Citibank and Royal Bank of Scotland, which are providing debt funding for Glas Cymru.

Freshfields Bruckhaus Deringer is also involved in this latest bid for Dwr Cymru, but head of corporate Barry O'Brien refused to comment on the firm's role.

Freshfields previously acted for Nomura on the battle for Hyder, although it is not clear whether the Japanese investment bank would be interested in making its own bid for Dwr Cymru.

One source says that during the bid for Hyder, which began in April, Nomura was primarily interested in the water side of the business while WPD coveted the electricity assets of the group.