American Water to sell Arizona, New Mexico operations to EPCOR

Sponsored by

VOORHEES, NJ, Jan. 24, 2011 -- American Water Works Company Inc. (NYSE: AWK), the largest investor-owned U.S. water and wastewater utility company, today announced that it has entered into an agreement with EPCOR Water (USA) Inc. ("EPCOR USA") to sell 100 percent of the stock of its companies that provide regulated water and wastewater services located in Arizona and New Mexico, for an estimated sale price of $470 million, subject to certain adjustments. American Water's total investment in both subsidiaries was approximately $450 million as of December 31, 2010.

American Water said it plans to use the proceeds from the sale to reduce both equity and debt financing. The completion of the transaction is subject to customary closing conditions including regulatory approval by public utility commissions in both Arizona and New Mexico.

"This transaction allows us to direct our focus to those operations where we can best serve customers and meet business objectives," said Jeff Sterba, president and CEO of American Water. "Additionally, with this transaction we do not anticipate the need for an equity offering in 2011."

American Water serves approximately 174,000 customers in Arizona and New Mexico. Both American Water and EPCOR are committed to working together to ensure that the transition is a smooth one for customers and that reliable service will continue throughout the transition. Both companies also place significant value in the over 220 employees who work in New Mexico and Arizona and pledge to make this change as seamless as possible. EPCOR USA anticipates that employees will continue to operate these systems within the EPCOR family, once the transaction closes.

EPCOR USA is in the business of building, owning and operating water and wastewater treatment facilities in the southwestern United States. In 2010, EPCOR USA entered into an agreement with American States Water to purchase and operate the Chaparral City Water Company, which serves 13,000 customers in the town of Fountain Hills, Arizona.

EPCOR USA is a wholly owned subsidiary of EPCOR Utilities Inc. ("EUI"). EUI builds, owns and operates water and wastewater treatment facilities, and electric transmission and distribution networks. It provides water and wastewater services to more than one million people in over 70 communities in Western Canada.

Founded in 1886, American Water is the largest investor-owned U.S. water and wastewater utility company. With headquarters in Voorhees, N.J., the company employs more than 7, 000 dedicated professionals who provide drinking water, wastewater and other related services to approximately 15 million people in more than 30 states and parts of Canada.

###

Sponsored by

TODAY'S HEADLINES

Request for proposals now available for 11 new WRF research projects

The Water Research Foundation has announced that requests for proposals are now available for 11 new research projects funded under the Focus Area Research Program. Two additional RFPs are also available for projects under the Emerging Opportunities Research Program.

Reclamation announces FY16 budget of over $36M for western rural water projects

The Bureau of Reclamation has announced its FY16 budget for rural water projects across six western states -- Montana, North and South Dakota, Iowa, Minnesota, and New Mexico -- in an effort to deliver potable water supplies to specific communities.

Halosource, Frutiger Company sign joint marketing, sales and supply agreement

Frutiger Company recently announced that it has signed a joint marketing, sales and supply agreement with HaloSource, Inc.

EPA awards over $17M in Great Lakes Restoration Initiative grants to address algal blooms

The Environmental Protection Agency has announced the award of 14 Great Lakes Restoration Initiative grants totaling over $17 million to fund projects that will improve Great Lakes water quality by preventing phosphorus runoff and soil erosion that contribute to algal blooms.

FOLLOW US ON SOCIAL MEDIA