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Virginia American Water has finalized the acquisition of the Town of Cape Charles water and wastewater systems for $15 million, bringing approximately 1,400 customers to the company. They plan to invest over $10 million in system improvements over the next eight years, with a focus on enhancing water quality. The acquisition was made possible under the Fair Market Value Legislation enacted by the Virginia General Assembly in 2020. The Town of Cape Charles residents will benefit from Virginia American Water's expertise and high-quality service, as well as the transition of utility employees to the company.
Virginia American Water ha completato l'acquisizione dei sistemi idrico e fognario della città di Cape Charles per 15 milioni di dollari, aggiungendo circa 1.400 clienti all'azienda. Prevedono di investire oltre 10 milioni di dollari in miglioramenti al sistema nell'arco dei prossimi otto anni, concentrandosi sul miglioramento della qualità dell'acqua. L'acquisizione è stata resa possibile grazie alla legge sul Valore di Mercato Equo approvata dalla Assemblea Generale della Virginia nel 2020. I residenti della città di Cape Charles beneficeranno dell'esperienza e della qualità dei servizi di Virginia American Water, nonché del passaggio dei dipendenti delle utilità alla compagnia.
Virginia American Water ha finalizado la adquisición de los sistemas de agua y aguas residuales del pueblo de Cape Charles por 15 millones de dólares, incorporando aproximadamente 1.400 clientes a la compañía. Planean invertir más de 10 millones de dólares en mejoras del sistema en los próximos ocho años, con un enfoque en mejorar la calidad del agua. La adquisición fue posible bajo la Ley de Valor de Mercado Justo promulgada por la Asamblea General de Virginia en 2020. Los residentes del pueblo de Cape Charles se beneficiarán de la experiencia y el servicio de alta calidad de Virginia American Water, así como de la transición de los empleados de los servicios públicos a la compañía.
버지니아 아메리칸 워터가 케이프 찰스 타운의 상하수도 시스템을 1천5백만 달러에 인수를 완료하여 회사에 약 1,400명의 고객을 추가했습니다. 앞으로 8년간 시스템 개선을 위해 1천만 달러 이상을 투자할 계획이며, 특히 수질 향상에 중점을 둘 예정입니다. 이번 인수는 2020년에 버지니아 주 의회에서 제정된 공정시장가치 법률에 따라 가능했습니다. 케이프 찰스 타운의 주민들은 버지니아 아메리칸 워터의 전문성과 고품질 서비스를 이용할 수 있게 되며, 공공시설 직원들의 회사로의 전환이 이루어질 것입니다.
Virginia American Water a finalisé l'acquisition des systèmes d'eau et d'eaux usées de la ville de Cape Charles pour 15 millions de dollars, ajoutant environ 1 400 clients à l'entreprise. Ils prévoient d'investir plus de 10 millions de dollars dans des améliorations du système au cours des huit prochaines années, en se concentrant sur l'amélioration de la qualité de l'eau. L'acquisition a été rendue possible sous la législation de la Valeur Marchande Juste adoptée par l'Assemblée Générale de Virginie en 2020. Les résidents de la ville de Cape Charles bénéficieront de l'expertise et du service de haute qualité de Virginia American Water, ainsi que de la transition des employés des services publics vers l'entreprise.
Virginia American Water hat den Kauf der Wasser- und Abwassersysteme der Stadt Cape Charles für 15 Millionen US-Dollar abgeschlossen und bringt etwa 1.400 Kunden zum Unternehmen. Sie planen, über die nächsten acht Jahre mehr als 10 Millionen US-Dollar in Systemverbesserungen zu investieren, mit einem Schwerpunkt auf der Verbesserung der Wasserqualität. Die Akquisition wurde durch die Fair Market Value Gesetzgebung ermöglicht, die 2020 von der Generalversammlung von Virginia erlassen wurde. Die Einwohner von Cape Charles werden von der Expertise und dem hochwertigen Service von Virginia American Water profitieren sowie vom Übergang der Versorgungsmitarbeiter zum Unternehmen.
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Insights
From a financial perspective, the acquisition of Cape Charles water systems by Virginia American Water represents a strategic expansion move. The 15 million price tag for approximately 1,400 customers can be seen as an investment in long-term growth and stability. This acquisition cost should be scrutinized in relation to the revenue potential from these new customers and the 10 million planned for critical system improvements. Investors should assess whether these capital expenditures align with the company's historical spending patterns and return on investment metrics.
One notable aspect is the application of Fair Market Value Legislation, which may offer a more favorable acquisition cost structure and could potentially lead to more such acquisitions in the future. Investors should keep an eye on the company's leverage and cash flow statements in upcoming quarters to gauge the immediate financial impact of the acquisition and the efficiency of the planned capital investments.
Market dynamics in the utility sector are often influenced by regulatory changes and infrastructure needs. The Town of Cape Charles's decision to sell is likely a response to these pressures and Virginia American Water's acquisition positions it to capitalize on economies of scale. Investors should consider the competitive landscape in Virginia and how this acquisition might affect Virginia American Water's market share and pricing power.
It's also essential to consider customer perspectives. The transition to Virginia American Water's systems might result in changes to customer billing and service quality. How smoothly this transition occurs can affect customer satisfaction and retention, which are key drivers of long-term revenue sustainability for utility companies.
The commitment to invest in critical system improvements could not only ensure regulatory compliance and high service quality but also enhance Virginia American Water's reputation as a responsible environmental steward. However, the environmental impact of these improvements will be a point of interest for ethically minded investors. The comprehensive planning study mentioned will likely outline the sustainability measures and any enhancement to the resiliency of water and wastewater systems against climate change impact.
Investors with an interest in sustainable and responsible investments should look for details on how these system improvements will address water conservation, pollution control and other environmental concerns. The benefits could extend beyond compliance, possibly offering a competitive edge and favorable public opinion.
ALEXANDRIA, Va.--(BUSINESS WIRE)--
Virginia American Water announced today it has closed the acquisition of the drinking water and wastewater system assets of the Town of Cape Charles, Virginia for $15 million. This acquisition brings approximately 1,400 water and wastewater customers to Virginia American Water and is the second to be completed by the company under the Fair Market Value Legislation enacted by the Virginia General Assembly in 2020.
Back row (l to r): Adam Charney, Mayor, Town of Cape Charles and Steve Bennett, Vice Mayor, Town of Cape Charles. Front row (l to r): John Hozey, Town Manager, Town of Cape Charles and Charlie Piekanski, Vice President of Operations, Virginia American Water (Photo: Business Wire)
As part of the acquisition, Virginia American Water will invest more than $10 million in future critical system improvements over the next eight years. A comprehensive planning study will be completed during the first year to identify and prioritize the required capital investment projects to improve the systems and the quality of the drinking water.
“We are delighted to welcome the residents of Cape Charles as our newest customers. Thank you to Mayor Adam Charney, the Town Council, and Town Manager John Hozey and his staff for their support throughout the process. The customers who join us with this acquisition will benefit from our company’s expertise in operating drinking water and wastewater systems, including a stellar record of water treatment, water quality testing and compliance. They will receive the same high-quality service that our customers throughout the state expect and deserve,” said Barry Suits, president of Virginia American Water.
“Joining Virginia American Water was the right decision for Cape Charles. This has been a lengthy process to allow the amount of due diligence needed for a decision of this magnitude and for the transparency and public input we committed to from the beginning. As a partner, Virginia American Water brings the expertise needed to properly operate both our water and wastewater systems, as well as economies of scale that will benefit our customers that the Town couldn’t have achieved on its own. We are also thrilled to see our eight utility employees transition to become Virginia American Water employees, keeping all that local knowledge and experience here working for our residents,” said John Hozey, Cape Charles Town Manager.
The Town of Cape Charles signed an agreement to sell its drinking and wastewater systems to Virginia American Water in January of 2023, based on the need to upgrade the system's infrastructure and bring additional experience and expertise in water management. Virginia American Water takes a proactive approach to maintaining infrastructure and invested more than $53 million in water system improvements statewide in 2023 alone.
Virginia American Water will be sending information to customers served by the Cape Charles Systems this week, including how to enroll in MyWater, the company’s online customer portal, as well as other customer service information and benefits. The company also provides bill paying assistance programs, conservation tips and more.
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 with regulated operations in 14 states and on 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. For more information, visit amwater.com and join American Water on LinkedIn, Facebook, X and Instagram.
About Virginia American Water
Virginia American Water, a subsidiary of American Water, is the largest regulated water utility in the state, providing high-quality and reliable water services to approximately 350,000 people. For more information, visit www.virginiaamwater.com and follow Virginia American Water on X and Facebook.
What was the acquisition price for the Town of Cape Charles water and wastewater systems by Virginia American Water?
Virginia American Water acquired the Town of Cape Charles water and wastewater systems for $15 million.
How many customers will Virginia American Water gain from the acquisition of the Town of Cape Charles water and wastewater systems?
Virginia American Water will gain approximately 1,400 water and wastewater customers from the Town of Cape Charles acquisition.
What is the focus of Virginia American Water's investment of over $10 million in the Town of Cape Charles water and wastewater systems?
Virginia American Water plans to invest over $10 million in future critical system improvements over the next eight years to enhance water quality.
Under what legislation was the acquisition of the Town of Cape Charles water and wastewater systems made possible?
The acquisition of the Town of Cape Charles water and wastewater systems by Virginia American Water was made possible under the Fair Market Value Legislation enacted by the Virginia General Assembly in 2020.
What benefits will the residents of Cape Charles receive from joining Virginia American Water?
Residents of Cape Charles will benefit from Virginia American Water's expertise in operating drinking water and wastewater systems, high-quality service, and utility employees transitioning to the company.
