Long Island American Water becomes largest investor-owned water utility in New York
American Water Works Company has closed its acquisition of seven water systems in New York and the sale of its regulated operations in Ohio. The agreement for these transactions with Aqua America was announced last July. The completion was contingent on regulatory approval in New York and Ohio.
“The completion of these agreements to expand our operations in New York and divest our operations in Ohio is part of American Water’s overall plan to operate in areas where it can best serve customers by leveraging economies of scale and our technological expertise,” said Jeff Sterba, president and CEO. “Adding these systems to our existing New York operations helps us to create value for our customers and provides an important opportunity for growth in areas north of New York City.”
Under the agreement, American Water acquired seven regulated water systems in New York for $39 million in cash and assumed $23 million of debt. The systems are in Nassau, Washington, Westchester and Ulster counties and serve 152,000 people. The purchase nearly doubles the company’s customer base in New York and establishes Long Island American Water as the largest investor-owned water utility in the state.
In a separate transaction, American Water sold its eight regulated water systems and one wastewater system in Ohio to Aqua America for $101 million in cash and $11 million in assumed debt. Ohio American Water serves 200,000 people. In both transactions, American Water will receive net cash of $60 million.
American Water and Aqua America are committed to working together to ensure a smooth and seamless transition for customers as well as employees. About 40 Aqua employees in New York will become American Water employees, and 77 American Water employees in Ohio will become Aqua employees.