Water company Severn Trent has bought a food waste recycling company in a deal worth £120 million.

Agrivert UK generates energy from food waste and has five anaerobic digestion (AD) facilities and five waste composting sites located to the south and west of the Severn Trent region.

The recycling company’s UK operations will be added to the water firm’s non-regulated Green Power Business, with the addition of the plants complementing its two food waste AD plants at Coleshill and Roundhill in Birmingham.

Another is currently under construction in Derby and is expected to be completed by the end of the financial year.

The acquisition will add 106GWh of power generation per year to the 354GWh currently produced by Severn Trent.

Liv Garfield, Chief Executive of Severn Trent said: “Renewable energy is strategically important to Severn Trent and the UK as a whole as we work towards achieving our decarbonisation targets and delivering attractive shareholder returns.

“Agrivert UK strengthens our established presence in anaerobic digestion where we have been leaders in the water sector for many years.”