Connecticut Water Service Inc. (CTWS) announced that it has completed the acquisition of the Biddeford and Saco Water Co. (BSWC). Shareholders of BSWC exchanged their stock for CTWS stock in a transaction with an enterprise value of $19.8 million. BSWC serves nearly 15,500 customers, or a population of 50,000 people, in 4 communities in the state of Maine.
In less than 12 months, CTWS has grown its customer base by 35% through acquisitions in Maine. In January 2012, CTWS acquired The Maine Water Co., formerly known as Aqua Maine Inc., that serves 16,000 customers, or 48,000 people, across the state of Maine, and less than 12 months later it has acquired BSWC.
Overall CTWS, through Maine Water and BSWC, serves more than 31,000 customers, or a population of nearly 100,000 people, in Maine, and 90,000 customers, or 300,000 people, in Connecticut through The Connecticut Water Co.
According to Eric W. Thornburg, CTWS's chairman, president and CEO, Biddeford and Saco Water Company will benefit from being a part of New England's fastest growing water utility company.
"CTWS has the financial resources to fund the infrastructure investments that are necessary to ensure that a reliable supply of high-quality water is delivered to customers in Biddeford, Saco, Old Orchard Beach and Scarborough,” Thornburg said. “Prior to today's acquisition, BSWC did not have the financial strength to fund infrastructure investments at the same level as CTWS. The acquisition gives CTWS additional economies of scale and further enhances weather and regulatory diversity."
Thornburg thanked Jerry Mansfield, the retiring president of Biddeford and Saco Water Co., for his efforts that contributed to a smooth transition for customers and employees with the completion of this transaction less than five months after it was announced. CTWS and BSWC had announced on July 19, 2012, that the companies had reached an agreement for BSWC to merge into CTWS. The MPUC had approved the acquisition on Nov. 7, 2012, and the closing was completed on Dec. 10, 2012.
As called for under the previously announced agreement, the acquisition was executed through a stock-for-stock merger transaction valued at approximately $11.4 million. Holders of BSWC common stock receive shares of CTWS common stock in a tax-free exchange. In addition, Connecticut Water will assume approximately $8.4 million in debt of Biddeford and Saco Water Company. The transaction reflected a total enterprise value of approximately $19.8 million.