An arm of BlackRock, the world’s biggest asset manager, is plotting a bid to acquire a big stake in a major contractor to Thames Water even as the UK’s largest water utility hovers close to collapse.

Sky News has learnt that BlackRock’s private markets division is among the remaining bidders for Lanes Group, which is based in Leeds.

City insiders said an unspecified number of other suitors were also in the process.

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Lanes Group is said to be valued at up to £350m, according to banking sources.

BlackRock has begun to play an increasingly active role as a bidder in processes populated by conventional private equity firms.

The New York-listed behemoth, run by chairman Larry Fink, manages a gargantuan $10.65trn in assets, having exploded in size over the last decade.

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Lanes Group provides wastewater and drainage services, and generates a significant chunk of its revenues from Thames Water alongside other major water utilities.

The industry is under intense pressure from the new Labour government, industry regulator Ofwat and other stakeholders amid public anger over wastage and pollution levels.

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Thames Water is battling to avoid temporary nationalisation as it faces running out of money within ten months unless it can raise additional equity.

Blackrock declined to comment, while Lanes Group could not be reached for comment.

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