Argentina has launched the tender to privatize Aysa, the company that provides drinking water and sewerage services in the Buenos Aires metropolitan area. The move is part of the broader privatization program of state-owned companies being carried out by the administration of President Javier Milei.
Under the terms of the process, 90% of Aysa's shares, currently held by the national government, will be sold, while up to 10% of the share capital will remain with employees through an employee stock ownership program. Market estimates place potential revenues for the government at around US$500 million.
Aysa operates a 25,537 km potable water network and serves roughly 3.4 million residential users and 350,569 non-residential users. More than three million of these users are billed under an unmetered consumption regime. The company owns three water treatment plants, 24 groundwater treatment plants, and 14 pumping stations. It also operates a 19,012 km network of sewer drains, 21 treatment plants, and 201 pumping stations.
The government is seeking a strategic operator with documented experience in infrastructure projects, public services, regulated companies, or similar activities, with an aggregate value of no less than US$150 million over the past 10 years and a net worth above US$300 million. Private equity funds that participate must demonstrate assets under management of at least US$1 billion.
Aysa operates a 25,537 km potable water network and serves roughly 3.4 million residential users and 350,569 non-residential users
Two Brazilian companies, Sabesp and Aegea, have confirmed their interest in the tender. A joint venture formed by Brazilian firm Grupo Águas do Brasil and Vinco Partners has also been cited in local press reports as a potential participant. Argentine company Edison Energía, a holding company of the Neuss group, which owns electronics and home appliance manufacturer Newsan and the alfajor company Havanna, is also viewed as a possible bidder. Edison Energía and Genneia recently acquired a controlling stake in the power transmission company Transener.
Other parties that may participate include Grupo Roggio, an infrastructure conglomerate with operations in water and sanitation in the city of Córdoba, and Mauricio Filiberti, owner of Transclor, a chemical company that produces supplies for water treatment and purification.
According to the Ministry of Economy, the incorporation of a strategic partner aims to strengthen investment capacity, support the modernization of infrastructure, and establish a sustainable and predictable framework for the provision of drinking water and sanitation services, while supporting the continuity, expansion, and quality of service.
The bidding schedule sets August 27 as the deadline for submission of bids, with envelopes to be opened the same day. Bidders will be evaluated on technical, financial, equity, and legal criteria.
Pressure from user associations
The tender introduces changes to Aysa's concession contract that have prompted reactions from consumer groups. The user defense association Deuco has raised concerns about a provision allowing the service provider to cut off service to residential users for late payment. Under the previous regulatory framework, the company could only apply restrictions such as flow reduction, in cases of non-payment.
According to Deuco, there are currently around 400,000 users with debts totaling 357 billion pesos (US$255.9 million). The change has also been opposed by the Office of the Ombudsman of the Province of Buenos Aires.
