Pennon pledges to grow Viridor

WATER group Pennon today pledged to continue to grow its Viridor waste management business aggressively despite being beaten by Guy Hands' Terra Firma group in the battle to take over Shanks' landfill operations.

Viridor has about 12% of Britain's landfill capacity, and figures from Pennon today reveal the business is growing by 20% a year, helped by a two-year buying spree in which it paid a total of £104m for seven rivals.

Pennon chief executive David Dupont denied that Terra Firma's bigger firepower - it won Shanks' landfill operations with a bid of £227m against Pennon's £202 million offer - meant Pennon would miss out on new acquisitions.

'There are still plenty of opportunities and we have 20 serious propositions a year coming across our desk,' he said. 'All we are saying is that we will not verpay.'

Dupont refused to say whether Terra Firma is still sniffing around Pennon after Hands last week lodged a rejected £1bn bid for the company.

The abortive Shanks bid cost Pennon £9m in fees, which marginally held back earnings in the year to end-March. It reported full-year underlying pre-tax profits up 6% at £78m.