American Water Works to Sell NY Regulated Operations in $608M Deal
American Water also announced it had reached an agreement to sell its Keystone Clearwater Solutions operations of Hershey, PA to SC Water LLC, a College Station, PA-based natural gas and oil industry investment group.
CAMDEN, NJ—Locally-based American Water Works Co. has reported plans to sell its regulated New York operations—New York American Water—to Liberty Utilities, the regulated utility business of Algonquin Power & Utilities Corp. of Ontario, Canada, for $608 million.
American Water and Liberty Utilities anticipate the sale will close in the latter half of 2020. The two firms have agreed to a sale price of approximately $608 million in cash. The completion of the transaction is subject to the satisfaction or waiver of various conditions including regulatory approval by the New York Public Service Commission.
Wells Fargo Securities, LLC is serving as exclusive financial advisor and Holland & Knight LLP is serving as legal advisor to American Water.
“This was a very difficult decision for American Water, as we have had the privilege of serving customers and communities in New York for more than 130 years,” says Susan Story, president and CEO of American Water. “After a careful and comprehensive analysis, we believe it is in the best interest of our customers in New York to sell to Liberty Utilities, which already has water utility operations and will have a larger presence in New York once the transaction closes. We are committed to working together to ensure that the transition is unnoticeable to our customers and that safe and reliable water service continues throughout the transition and beyond.
The companies report that no jobs will be lost as a result of the transaction, with a commitment by Liberty Utilities to maintain existing employment terms for two years following the closing including keeping salaries and benefits comparable for New York American Water employees.
Liberty Utilities Co. owns and operates regulated water, wastewater and energy utilities in 14 states, delivering responsive and reliable essential services to over 800,000 customers connections across the United States. Liberty Utilities currently operates in Arizona, Arkansas, California, Georgia, Illinois, Iowa, Kansas, Massachusetts, Missouri, Montana, New Hampshire, New York, Oklahoma and Texas.
American Water also announced it had reached an agreement to sell its Keystone Clearwater Solutions operations of Hershey, PA to SC Water LLC, a College Station, PA-based natural gas and oil industry investment group. No financial terms of that transaction were disclosed. American Water anticipates that sale will close before the end of 2019.