Saur: sufficient, safe and affordable water for everyone

Water infrastructure in France
‘Paris-based Saur has an international business portfolio, but France is still the largest sales market. Here, Saur manages the water systems for dozens of French municipalities for which they have won the tender. This concerns drinking and waste water, two separate parts of the chain. The same thing is happening in Spain and Portugal. Saur is also active in the Middle East, yet this is often structured and organized in a slightly different way.' 

Responding to water scarcity
'The investment fits perfectly in our infrastructure portfolio; offering an essential basic supply for society, just as we do with our investments in gas, electricity and toll roads. We also saw an opportunity: water, like energy, is becoming a scarce resource. You might think of the desert talking about water shortage, but we also see this scarcity in Western Europe. It is becoming more and more topical and urgent.'

Icing on the cake
'The third part - and for us the icing on the cake - is the industrial water branch, built around a company that Saur has taken over: Nijhuis Saur Industries. They manage water systems for industrial customers, such as in the food and beverage industry. With innovative solutions and technologies, they purify water, get it to the right quality and ensure that less is wasted. In the end, they even want to return the waste water to the process: 'brewing beer with waste water'. The industrial water branch is a fairly new segment which is growing fast and has a lot of potential worldwide. Saur is the ideal combination in this sense: the classic utility function of drinking and waste water with the industrial component. The latter may be a bit more exciting from a risk and management perspective, but together as a whole it is a good infrastructure investment.'

Towards net zero
‘Together with DIF Capital and EQT Infrastructure – with 50% of the company – we have a strong degree of control over the business. There is a whole list of things that we have something to say about, so we can strengthen the ESG agenda even more and steer towards net-zero targets. We want to have our infrastructure portfolio STBTi-verified (Paris aligned) step by step, and this year Saur's plan to be net zero by 2050 was approved. Among other things, we are moving to green energy, which is also an important cost item for a company like Saur. But we can do even more on the waste side, where we have a lot of sludge for example. DIF, EQT and Saur are also open to this.'

Risks
'Of course there are also risks. Occasionally we lose contracts. You win some, you lose some and on balance you grow, that's the idea. Of course, things can go differently and I think that is the biggest risk. But certainly in France, the largest market, the situation is stable. In addition, the water supply can pose a risk, in areas that are sensitive to drought you have to replenish your stock in time. In the Middle East, we have to make sure that everything goes according to the rules, because we worked with local subcontractors over there. We haven’t found anything to stop us from moving forward so far.'

Return and impact
'Because we run a little more risk – the industrial branch is still developing – and the higher interest rates, this investment has a slightly higher expected return than the other investments we have made in recent years. In addition, we make a real impact. Saur is responsible for the water supply of millions of people. Keeping that affordable is an important factor. By helping Saur to be efficient and becoming even more efficient with our investment and management, we are meeting this need.'