American Water Works Company announces intention to terminate the SJW Corp. merger agreement
Regulatory delays could mean the end of American Water Works Co.'s bid to merge with SJW Corp.
Feb. 23, 2001—Regulatory delays could mean the end of American Water Works Co.'s bid to merge with SJW Corp.
American Water Works Company, Inc., (NYSE:AWK) today announced that, in light of additional delays outlined in a new procedural scheduling order issued by the California Public Utilities Commission (CPUC), the company will exercise its right to terminate the SJW Corp. (SJW) merger agreement on April 28, 2001.
The February 20, 2001 CPUC scheduling order extends the date for a final decision regarding review of the merger application to at least September 2001.
"Continued uncertainty surrounding the regulatory process in this matter makes it impossible to plan and effectively implement the transaction contemplated by the agreement," noted Mr. J. James Barr, the company's president and chief executive officer. "We have reached the point that the interests of all concerned are best served by concluding this matter," Barr added.
The process of regulatory review of the application to merge SJW into American Water Works is now combined with a separate application requesting approval of an agreement to purchase the water assets of Citizens Communications (CZN) located in California. American Water Works noted that it would continue to diligently pursue completion of the Citizens' transaction and that documentation before the CPUC allows separate evaluation of the SJW and CZN transactions. The termination date of American Water Works' agreement with Citizens is September 2001.
"Today's action does not signal any lack of interest by American Water Works in continuing to participate in the essential consolidation taking place in the water and wastewater industry," Mr. Barr emphasized. "However, decisive regulatory action is absolutely critical in order to successfully complete this important initiative."
American Water Works Company is the largest and most geographically diverse investor-owned water service provider in the nation. Its subsidiaries serve a population of approximately 10 million customers in 23 states.