Unions braced for job losses at United Utilities

Unions fear that 2,000 job losses may be announced today at United Utilities, the company formed by North West Water's pounds 1.8bn takeover last year of Norweb, the regional electricity firm.

There was also speculation yesterday that the group might dispose of its retail operations, which have a substantial high street and superstore presence in the North-west. City sources said that the most likely route for such a disposal would be a management buyout.

United Utilities declined to comment, but the group is expected to make an announcement to the Stock Exchange this morning. Shares in the company rose 19p to 597p.

Commenting on the rumours, one City analyst said: "The merged operation will have big restructuring costs. Hefty job cuts seem inevitable at some stage."

He added: "They do not seem to have made much progress so far in integrating the business or on delivering the reductions in cost."

Last year Norweb had about 7,600 full-time equivalent employees, 2,000 of them in retail operations - a business the company had pursued energetically.

North West water had a similar workforce, including over 5,000 in the core water and sewage business.

Unions fear the job cuts might be in addition to reductions on the retail side. City analysts said that a combination of 2,000 redundancies with a retail disposal would be viewed by investors as aggressive.

In November, the group warned that there would be a shake-up in the combined operation, which finally came into being on 1 January.

Brian Staples, then chief executive of North West Water, said:"We're going to completely redesign the group. The idea is to create more non- regulated earnings."

The company has already made progress on that front, with a recent 20- year agreement to operate water and sewer services for North Brunswick in the state of New Jersey in America.

Mr Staples also said that United Utilities should be able to deliver real dividend growth of 8 per cent or greater, against the 7 per cent real growth promised by North West alone.

Mr Staples had earlier angered consumer groups by saying that if the takeover went ahead, shareholders would see the first benefits from any savings from job losses and rationalisation over the rest of the decade.

He said that for the first five years, the money would go to shareholders as higher dividends, and only after the year 2000 would customers begin to see any effect on their bills, spread over five years.

Life and Style
The new Windows 10 Start Menu
tech
News
More than 90 years of car history are coming to an end with the abolition of the paper car-tax disc
newsThis and other facts you never knew about the paper circle - completely obsolete today
Arts and Entertainment
There has been a boom in ticket sales for female comics, according to an industry survey
comedyFirst national survey reveals Britain’s comedic tastes
Arts and Entertainment
Hilary North's 'How My Life Has Changed', 2001
books(and not a Buzzfeed article in sight)
PROMOTED VIDEO
Arts and Entertainment
Mystery man: Ben Affleck and Rosamund Pike in '‘Gone Girl'
films... by the director David Fincher
News
Kim Jong Un gives field guidance during his inspection of the Korean People's Army (KPA) Naval Unit 167
newsSouth Korean reports suggest rumours of a coup were unfounded
News
people'I’d rather have Fred and Rose West quote my characters on childcare'
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
stoptober... when the patch, gum and cold turkey had all faied
Travel
Bruce Chatwin's novel 'On the Black Hill' was set at The Vision Farm
travelOne of the finest one-day walks you could hope for - in Britain
Arts and Entertainment
Gay and OK: a scene from 'Pride'
filmsUS film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
News
people
Life and Style
Magic roundabouts: the gyratory system that has excited enthusiasts in Swindon
motoringJust who are the Roundabout Appreciation Society?
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Trust Accountant - Kent

NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...

Graduate Recruitment Consultant - 2013/14 Grads - No Exp Needed

£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...

Law Costs

Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...

Day In a Page

Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

The children orphaned by Ebola...

... then rejected by surviving relatives over fear of infection
Pride: Are censors pandering to homophobia?

Are censors pandering to homophobia?

US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
The magic of roundabouts

Lords of the rings

Just who are the Roundabout Appreciation Society?
Why do we like making lists?

Notes to self: Why do we like making lists?

Well it was good enough for Ancient Egyptians and Picasso...
Hong Kong protests: A good time to open a new restaurant?

A good time to open a new restaurant in Hong Kong?

As pro-democracy demonstrators hold firm, chef Rowley Leigh, who's in the city to open a new restaurant, says you couldn't hope to meet a nicer bunch
Paris Fashion Week: Karl Lagerfeld leads a feminist riot on 'Boulevard Chanel'

Paris Fashion Week

Lagerfeld leads a feminist riot on 'Boulevard Chanel'
Bruce Chatwin's Wales: One of the finest one-day walks in Britain

Simon Calder discovers Bruce Chatwin's Wales

One of the finest one-day walks you could hope for - in Britain
10 best children's nightwear

10 best children's nightwear

Make sure the kids stay cosy on cooler autumn nights in this selection of pjs, onesies and nighties
Manchester City vs Roma: Five things we learnt from City’s draw at the Etihad

Manchester City vs Roma

Five things we learnt from City’s Champions League draw at the Etihad
Martin Hardy: Mike Ashley must act now and end the Alan Pardew reign

Trouble on the Tyne

Ashley must act now and end Pardew's reign at Newcastle, says Martin Hardy
Isis is an hour from Baghdad, the Iraq army has little chance against it, and air strikes won't help

Isis an hour away from Baghdad -

and with no sign of Iraq army being able to make a successful counter-attack
Turner Prize 2014 is frustratingly timid

Turner Prize 2014 is frustratingly timid

The exhibition nods to rich and potentially brilliant ideas, but steps back
Last chance to see: Half the world’s animals have disappeared over the last 40 years

Last chance to see...

The Earth’s animal wildlife population has halved in 40 years
So here's why teenagers are always grumpy - and it's not what you think

Truth behind teens' grumpiness

Early school hours mess with their biological clocks
Why can no one stop hackers putting celebrities' private photos online?

Hacked photos: the third wave

Why can no one stop hackers putting celebrities' private photos online?