Duxton Water (ASX: D2O) has struck a $121.3 million deal to sell 30,614 megalitres of water entitlements to the Australian Federal Government, supporting environmental flows in the Murray-Darling Basin. The sale, executed at a premium to Net Asset Value (NAV), aligns with Duxton’s commitment to sustainable water management while delivering significant value for shareholders.
Key Details of the Sale
- Entitlements Sold:
- 3,010 ML of High Security water in NSW
- 13,114 ML of High Reliability water in Victoria
- 14,491 ML of General Security water in NSW
- Sale Proceeds: $121.3 million expected upon settlement
- Government Initiative: Part of the Restoring Our Rivers Act, which aims to recover 450GL for environmental sustainability
- Settlement Timing: Expected 10 business days after regulatory approvals
Strategic Benefits for Duxton Water
This deal enhances Duxton’s financial position while contributing to the long-term health of Australia’s river systems. The company plans to use the proceeds to:
- Complete $19 million in contracted acquisitions of permanent water entitlements.
- Reduce debt, strengthening its balance sheet and profitability.
Once these transactions are settled, Duxton’s entitlement portfolio will stand at 60.9 gigalitres, with an estimated valuation of $294.4 million (as of January 31, 2025).
What This Means for Investors
The sale underscores Duxton Water’s ability to generate value from its water portfolio while supporting environmental sustainability. By selling at a premium to NAV, the company has secured strong returns while maintaining a significant portfolio for future growth.
