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Pennsylvania American Water to acquire Audubon Water Company in a $8 million deal. Audubon's shareholders will receive AWK common stock. Pennsylvania American Water plans to invest $20 million in system upgrades within the first five years of ownership. The transaction is expected to be completed in late 2024.
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Pennsylvania American Water's acquisition of Audubon Water Company will expand its customer base and provide long-term access to safe drinking water. The $20 million investment in system upgrades demonstrates a commitment to improving infrastructure.
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MECHANICSBURG, Pa.--(BUSINESS WIRE)--
Pennsylvania American Water announced today that an agreement has been reached for it to acquire Audubon Water Company (Audubon). Under the terms of the transaction, an affiliate of Pennsylvania American Water will merge with Audubon, with shareholders of Audubon Water receiving shares of AWK common stock in exchange for all of the issued and outstanding shares of Audubon, and subsequently, Audubon will merge into Pennsylvania American Water. The transaction values Audubon at approximately $8 million.
Audubon is a private, investor-owned system serving approximately 2,900 customers in Lower Providence Township, Montgomery County and is located directly between Pennsylvania American Water’s existing Royersford and Norristown water systems.
“Through this transaction, our growing customer base will benefit from the financial investment needed to deliver necessary infrastructure improvements to secure long-term access to safe drinking water,” noted Martha Russell, President of Audubon.
Pennsylvania American Water will, over time, interconnect Audubon’s system with Pennsylvania American Water’s Royersford and Norristown systems, eliminating the system’s reliance upon groundwater supply and the need for PFAS-related treatment upgrades. This improvement will provide a cleaner and more reliable water source for Audubon’s customers as well as sufficient supply to support additional area growth. Within the first five years of ownership, the company plans to invest more than $20 million into the system to upgrade aging water infrastructure.
“We look forward to becoming the water service provider for these customers in Lower Providence Township, and we appreciate that the leadership at Audubon Water Company is entrusting us with this privilege,” said Pennsylvania American Water President Justin Ladner. “The interconnections, system upgrades and source of supply improvements we will accomplish through this acquisition will greatly benefit area customers, while further promoting regionalization and consolidation of our Montgomery County systems.”
Pennsylvania American Water and Audubon Water Company will seek approval of the acquisition from the Pennsylvania Public Utility Commission (PUC) and Pennsylvania Department of Environmental Protection. The transaction is expected to be completed in late 2024.
Pennsylvania American Water will adopt Audubon’s current rates at closing. The PUC regulates the company's rates, and any future rate changes would have to be reviewed and approved by the PUC. Pennsylvania American Water offers grants and discounted services to customers who qualify through its H2O Help to Others Program.
About American Water
American Water (NYSE: AWK) is the largest regulated water and wastewater utility company in the United States. With a history dating back to 1886, We Keep Life Flowing® by providing safe, clean, reliable and affordable drinking water and wastewater services to more than 14 million people across 14 regulated jurisdictions and 18 military installations. American Water’s 6,500 talented professionals leverage their significant expertise and the company’s national size and scale to achieve excellent outcomes for the benefit of customers, employees, investors and other stakeholders.
As one of the fastest growing utilities in the U.S., American Water expects to invest $30 to $34 billion in infrastructure repairs and replacement, system resiliency and regulated acquisitions over the next 10 years. The company has a long-standing history of executing its core operations, aligned with sustainable best practices, through its commitments to safety, affordability, customer service, protecting the environment, an inclusive workforce and strengthening communities.
American Water has been recognized on the 2023 Bloomberg Gender-Equality Index for the fifth consecutive year, ranked 18th on Barron’s 100 Most Sustainable U.S. Companies 2023 List, earned the U.S. Department of Homeland Security SAFETY Act designation and U.S. Environmental Protection Agency’s WaterSense® Excellence Award, among additional state, local and national recognitions.
Pennsylvania American Water, a subsidiary of American Water is the largest investor-owned water utility in the state, providing high-quality and reliable water and wastewater services to approximately 2.3 million people.
