Maputo — Aguas de Mocambique (Waters of Mozambique), the private consortium that manages water supply in the major Mozambican cities, on Wednesday night launched a "new image" for the company, promising "to improve our services, guaranteeing supplies of safe, good quality water".

The facelift for Aguas de Mocambique, including a new company logo, follows a turbulent period, in which the company at one point came close to bankruptcy.

The chairman of the board of directors, Arnaldo Lopes Pereira, told the Wednesday ceremony that the consortium's initial investment plans were derailed by the catastrophic floods of February 2000.

The consortium won the contracts to operate the Maputo/Matola water service, and to manage water supply in Beira, Quelimane, Nampula and Pemba in 1999, and began its work the following year.

But the worst floods in living memory that year in the south and centre of the country wrecked many of the water supply installations, particularly in Maputo and Matola. Instead of embarking upon the investment necessary to expand the water service, Aguas de Mocambique was forced into emergency repairs of the existing installations.

The consortium's financial plans were based on rapidly increasing the amount of water it sold. This proved impossible: heavy losses were made in 2000, and attempts to bring the company into financial health in 2001 failed.

The lead player in the consortium, the French company Saur International, which held 38.5 per cent of the shares, was running into severe economic difficulties internationally in 2001, compounded by the effects of the 11 September terrorist attacks against Washington and New York on the world economy.

Pereira said that in late 2001, Saur wanted to declare Aguas de Mocambique bankrupt. But the other shareholders - the Portuguese water company, Aguas de Portugal, and a grouping of four Mozambican companies, Mazi-Mozambique - disagreed.

The end result was that Saur left the consortium, and Aguas de Portugal is now the leading shareholder. Throughout 2002 negotiations on amending the contracts were held between the consortium and FIPAG, the government body responsible for water supply assets.

Pereira said that new contracts were signed in June 2003.

The consortium now enjoyed "shareholder stability", and was finally embarking on a concrete programme of investment.

The priority projects include expanding the production capacity at the Maputo water treatment station on the Umbeluzi river, and studying possible complementary sources for the capital.

Pereira said Aguas de Mocambique will work to reduce losses of water (caused by obsolete piping, and by clandestine, illegal connections to the network), and improve the collection of money owed by consumers. The consortium intended "to promote the economic and environmental sustainability of the system".

He put the total number of people reliant on Aguas de Mocambique for their water supply at two million.

The ceremony was also the occasion for introducing the new managing director of the consortium, Jose Mestre, of Aguas de Portugal. He was previously manager of Electra, the Portuguese consortium that runs water supply in Cape Verde.