October 2, 2018

CT Water sets shareholder vote on $1.1B SJW merger

PHOTO | Contributed
PHOTO | Contributed
A Connecticut Water truck.

Connecticut Water Service Inc. shareholders are scheduled to vote next month on the company's $1.1 billion all-cash buyout offer from California's SJW Group, the Clinton-based water utility said.

Connecticut Water on Tuesday urged shareholders to approve SJW's $70-per-share acquisition offer at a special meeting on Nov. 16. The publicly traded water utility set the meeting after announcing it filed proxy materials with the U.S. Securities and Exchange Commission.

Connecticut Water's board of directors unanimously support the deal with SJW, the parent of San Jose Water Co., one of the West Coast's largest water purveyors.

Connecticut Water said its $70-per-share offer exceeds its all-time high closing stock price, adding that it never closed above $63.44 per share before the agreement was inked in March.

The utilities originally agreed to a $750 million merger, with Connecticut Water shareholders receiving about $61.86 per share. The California utility improved its offer for the third time in August amid competing offers from Eversource Energy and others.

Under the deal, the companies said they will honor their $200 million annual investments across both operations, including a new surface water treatment facility in Maine.

The 700-employee combined company would serve over 1.5 million people and become the nation's third largest investor-owned water and wastewater utility.

There will be no layoffs or customer rate changes if the transaction closes as expected in the first quarter of 2019.

Connecticut Water's leadership team, including CEO and president David Benoit, will also be maintained to oversee the New England region at its Clinton headquarters. Plus, two Connecticut Water board members will join SJW's expanded board.

The Clinton water utility and its subsidiaries, The Maine Water Co., The Avon Water Co. and The Heritage Village Water Co., would operate under their existing names following merger approval.

This story has been updated

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