The takeover is expected to be recommended within a few days. The move comes in a busy summer for the utilities sector in the Square Mile.
‘It's been a strong time for activity within this area, but the deal is also another example of infrastructure funds' increasing involvement in M&As,' said Tulchan founder Andrew Grant, who leads the brief with consultant Dominic Fry.
The agency won the account without a formal pitch. Cardew Group continues to be AWG's retained City agency.
The consortium advised by Tulchan is headed by private-equity group 3i, but has a number of foreign backers.
The consortium is also advised by Lexicon Partners, which Tulchan has worked with on past projects.
AWG has been subject to takeover speculation all year, with the impressive adoption of water meters by Anglian customers seen as an example of the firm's efficiency.
Anglian serves around 5.5 million people in the East of England.
Suitors are lining up for Thames Water, which German firm RWE has put up for sale. Prudential and Australian investment group AMP are meanwhile leading the race for South East Water, owned by Macquarie European Infrastructure Fund.
The sector is attractive to investors because companies within it offer steady and predictable earnings.