Pennon Group (PNN): Rights issue of 36% of the market value

This situation live

PNN Pennon Group

£1,747m · 334.0p · −18% since the first step

7 Oct 2026 · announced · -20% on the day · +2% since capital investment of approximately £3.6 billion in its regulated water businesses over AMP8, including the cost change programme.

7 Oct 2026 · announced · +2% since The operational plan, which is already underway, is practical and focuses on clearer accountability with key skills brought back in-house.

Dilutive fundraise

Rights issue of 36% of the market value

announced

RaiseRights issue · £550 million

Of market value35.7%

Discount44.7% to the last close

Use of the moneydebt

Reaction on the day−20%

As of 7 Oct 2026 ↗

Since Oct 2023: 301 situations of this kind – completed 77%, went quiet 23%; median share price -17% six months after they opened

OCT27 Next: Results of the rights issue announced in 1 day

Every step · 2

7 Oct 2026 announced · -20% on the day – capital investment of approximately £3.6 billion in its regulated water businesses over AMP8, including the cost change programme. ↗
7 Oct 2026 announced – The operational plan, which is already underway, is practical and focuses on clearer accountability with key skills brought back in-house. ↗

What is happening

Pennon Group: Rights issue of 36% of the market value – announced. ['announced']

In short: On 7 October 2026 Pennon launched a c.£550m fully underwritten rights issue to fund the enlarged AMP8 water investment. Terms are now set: 7 new shares for every 15 held at 250p, a 35.5% discount to TERP. It comes with a rebased dividend; gearing stays within policy.
Announced: 7 Oct 2026 · announced · -20% on the day
Latest: 7 Oct 2026 · announced · -20% on the day
Size: approximately £550 million; 220,257,997 new shares, fully underwritten by Barclays and Morgan Stanley
Use of money: Deliver the strategic plan and invest in additional growth through Ofwat's cost change process to March 2030
Dividend: FY2026/27 total c.£125m vs £138m; DPS around 18p, c.30% underlying cut
Gearing: Regulated water businesses no more than 65% of RCV; Group unlikely to exceed approximately 70%
Terms: price and discount not in this announcement; see separate announcement and IOC
Price: 250 pence per new share; 7 new for every 15 existing
Discount: 35.5% to theoretical ex-rights price, based on 452p close on 6 October 2026
Timetable: Acceptance by 26 October 2026; results and dealings in new shares 27 October 2026

What comes next

Results of the rights issue announced (27 Oct 2026).

From the company's own announcements. Not investment advice.

Briefing

Pennon Group in 4 minutes

Pennon owns water and sewerage companies in the South West of England and water-only companies around Bristol and in Surrey. It returned to profit in 2025/26 as a record investment programme began to lift its allowed...

Act 1Buying Sutton and East Surrey, funded by shareholders
Act 2The loss year and a bigger raise
Act 3Profit returns, but the weather and the targets bite

Read the briefing →

Also at Pennon Group 6 open

Transformational contract / build-outK8 capital investment programme – Programme enlarged to c.£3.6bn; draft determination out New CEO / resetCEO succession – Plan announced, actions under way Disposal of a part (break-up)Sale of Pennon Power – Proposed; listed in funding plan Project milestonesPennon Power build-out – Fife and Aberdeenshire energised, generating revenue Turnaround plan with targetsWastewater pollution reduction plan – Pollutions down c.34%; EPA 1* provisional Pennon Group – company page →