AWW and TMVW set to engage in structural collaboration

04/05/2010

Antwerp/Ghent - Two leading Flemish water companies, Antwerpse Waterwerken (AWW) and integral water company TMVW will be collaborating in a duly structural manner in the future.  The two companies are setting up a new company in Water.Link and recently signed a Memorandum of Understanding to this end.


Water.Link - collaboration with a vision for the future


Behind the decision by AWW and TMVW to engage in structured collaboration are a variety of different reasons. In doing so, the newly-created Water.Link is seeking to provide an answer to the increasingly stricter technical and ecological requirements set out in the field of water supply and water sanitation, as well as to cater to the constantly evolving and rising expectations of consumers. What is more, AWW and TMVW have found a significant decline in the consumption of (drinking) water. Amongst other things, this is due to the economic crisis, the technically more economical installations that are being used, the promotion of the rational use and re-use of water and the introduction of the all-in water rate.


Which is why AWW and TMVW are joining forces to be able to continue to guarantee the best favourable value for money both for their customers and their partners.  To do so, efforts are being brought to bear to step up the turnover, by extending and updating services and the product portfolio, and by working at controlling costs through economies of scale and synergies.


The collaboration is to be viewed as a logical step in intensifying and broadening what was already an extensive interaction. For one thing, AWW has been supplying around 40% of the total drinking water distributed by TMVW for many years already. As such, TMVW is the most important customer of the Antwerp water company, handling around a quarter of its sales volume.


A preparatory feasibility study has shown that collaboration will bring greater operational competitiveness, create genuine added value and enhanced cost efficiency.


Both partners are, after all, complementary in various areas. Amongst other things, this certainly applies to infrastructure (for production and transport), activities and territory of operations. They are convinced that this collaboration will result in a stronger joint market position for both parties.


There are also a number of very specific reasons that made both partners decide to intensify their collaboration. TMVW for instance is seeking to scale down its profile as a purchase company for drinking water which explains why it is currently looking for a solution for a significant portion of its existing purchasing volume. AWW has sufficient usable production capacity and is consequently stepping up as an alternative supplier for the volume that is becoming available. AWW will continue to invest in its production lines, TMVW in its transport network.


As such, the complementarity that exists between AWW and TMVW also extends to include industrial supplies. The strategy adopted for the Antwerp port region for example can be perfectly applied to the port regions of Ghent, Zeebrugge and  Ostend and similar locations with a relevant concentration of industrial activities. All of which combines to explain why the existing commercial approach and expertise are set to be pooled to make up a competitive whole.


Water.Link - a well-thought out and forceful collaboration


The idea behind Water.Link is for the new entity to assume the general management of the structural collaboration. In amongst other things, this will see Water.Link designing the group structure, perpetuating and expanding existing activities, developing new services and integrating the various service lines.


Planning to get things underway without further ado, Water.Link will initially serve as a management company. The short-term aim will be to put in place a thoroughgoing integration of the support and general management activities in ‘shared service centers’.


In addition, Water.Link will also act as the strategic decision-making centre, without losing sight of the individual identity of AWW and TMVW. With this aim in mind, Water.Link will develop business plans for and participate in the operating companies and structures to be set up by AWW and TMVW.


Water.Link will also be representing both companies in industry negotiations and external communications.


AWW and TMVW each hold 49 percent of Water.Link’s registered capital. From the outset, the remaining 2 percent will be reserved for other public water companies to climb on board.


Water.Link - collaboration with depth


With the Water.Link collaboration, both of the founding companies are keen to give substance to joint integral water management, including sanitation and wastewater management. For this purpose, an entity is being set up that goes by the name Rio.Link. Initially, Rio.Link is set to handle the integral water management for the city of Antwerp.


As Rio.Link grows, together with the integrated supply of drinking water supply and road management and with a special focus of attention going out to matters such as synergies, data management and a reduced nuisance policy, the aim is to put in place an effective and efficient domain management.


In support of all of the above, TMVW, AWW and Water.Link are setting up a Centre for Public Domain Asset Management (CoDAM).


With the incorporation of the Induss operating company, Water.Link is not only looking to provide a targeted, sustainable and economically responsible answer to the demand from industry for specific water but also to extend its services for industry to include the integral management of the water cycle.


Key figures

The collaboration with Induss enables us to reduce our carbon footprint. Transparency in our partnership is also the key for better cost control of water and steam.
Johan Rousseau
plant manager, Eastmann
We sustainably reduced our demin water cost
Ivago
management
Thanks to Induss’ full examination and mapping of my various water needs, I now receive guaranteed quality and secured delivery of industrial water for my production line and that at a fixed price for a full contract length.
Bart Vervenne
Plant Manager, Alco Bio Fuel