Sabesp, Sao Bernardo negotiating waterworks transfer

Brazil's Sao Paulo state water utility Sabesp and the municipality of Sao Bernardo do Campo are negotiating the transfer of water and sewerage services and the balance of the city's debt with Sabesp, the utility said in a statement. A source connected to the process told BNamericas that Sao Bernardo do Campo is one of seven municipalities in Sao Paulo's greater metropolitan area that receives untreated water from Sabesp, and that the seven municipalities owe the utility some 1bn reais (US$341mn). According to the source, as there is little probability the debt will be paid back, the idea is that Sabesp - at least in the case of Sao Bernardo for now - take over water and sewerage service, which is currently handled by the municipality. Sao Bernardo has some 660,000 residents, and boasts 96.9% water and 85.9% sewerage coverage. In the statement, Sabesp said that further details will be defined at an extraordinary shareholders meeting to be convened at a future date to approve the above mentioned negotiation in accordance with applicable law. Sabesp is Brazil's largest water utility in terms of users, serving 323 of Sao Paulo state's 645 municipalities. The utility provides water to 25 million residents through a 54,000km network and sewerage service to 16.8 million residents through a 34,000km collection network. Sabesp's five-year investment program calls for investing 550mn-600mn reais/year through 2006.