H2O America acquires Texas water utility with $540 million transaction

H2O America announced on July 8, 2025, that its regulated Texas water and wastewater utility, The Texas Water Company, Inc. (TWC), along with its affiliate Texas Water Operation Services, LLC (TWOS), and Quadvest, a regulated investor-owned water and wastewater utility operating in the Houston metro area, have entered into respective agreements pursuant to which TWC and TWOS will acquire all of the assets owned by Quadvest. This transaction marks a transformative milestone for H2O America, TWC, TWOS, and Quadvest, positioning the combined company to grow faster, operate at greater scale, and better serve communities across Texas.

Quadvest is one of the largest water and wastewater utilities in Texas, with over 47,000 active connections and over 89,000 connections under contract and pending development. Its facilities include 50 water treatment plants, 27 wastewater treatment plants, and 89 lift stations and underground assets, serving approximately 69 developments. Quadvest brings to TWC operational scale, a strong development pipeline in some of the fastest growing parts of the Houston region, meaningful partnerships with a range of developers and community leaders, in-house engineering, procurement and construction capabilities, capital investment opportunities, and a talented and experienced team.

This combination supports H2O America’s ongoing efforts to diversify, extend, and enhance its services for customers across the U.S. Based on customer connections, Texas customers would have comprised approximately 17% of H2O America’s total service base as of December 31, 2024, versus approximately 7% standalone, and they are projected to comprise approximately 26% of H2O America’s service base by 2029. The transaction accelerates TWC's strategic expansion from the San Antonio and Austin corridor into the Greater Houston metro area, one of the fastest-growing regions in Texas. Together, TWC and Quadvest will create the second largest investor-owned water and wastewater utility in Texas, based on connections. The combined company will have even stronger builder and developer ties, with an active pipeline of approximately 96,000 connections under contract.2 H2O America is committed to continuing its investment in Texas, with plans to spend over $500 million in the state over the next five years. As a result of this transaction, H2O America expects to increase its customer-focused, consolidated five-year capital spending plan to approximately $2.1 billion, an increase of 6%.

“The addition of Quadvest to TWC is a unique opportunity to strategically diversify, enhance, and expand H2O America’s operations in one of the nation’s fastest-growing regions, while strengthening our network of developers and driving stronger returns for our investors,” said CEO of H2O America Andrew F. Walters in a press release. “TWC and Quadvest will remain rooted in the Texas communities they serve today and continue to invest in sustainable infrastructure. By combining Quadvest’s and TWC’s deep local expertise with H2O America’s robust national platform, we will meaningfully advance our central mission to provide communities with clean, high-quality water and exceptional service.”

Mr. Walters added in the press release, “This combination is also expected to provide a stronger platform by enhancing our exposure to high-growth Texas markets, with Texas projected to become our second largest utility operation by 2028.1 We expect the combination to be accretive to our long-term growth rate, support our consolidated credit profile, and drive continued investment opportunities for H2O America. We remain committed to opportunistically executing strategic M&A to drive value for customers and shareholders.”

“Our combination with Quadvest represents an opportunity to grow our operations and provide safe, reliable, and sustainable water and wastewater solutions to tens of thousands of additional Texans,” said Aundrea Williams, president, TWC, in a press release. “With increased scale, TWC will be well positioned to strengthen operational excellence, customer service, and infrastructure investment, while maintaining our and Quadvest’s shared commitment to local expertise and an ownership mindset. Our combination is a natural fit, bringing together two companies who have aligned cultures, a mutual focus on community investment, and benches of talent who will drive our strategy forward. We have deep respect for the legacy Quadvest has built under the leadership of the Sequeira family, and we are excited to welcome Quadvest’s talented team to TWC. We look forward to working together to deliver high-quality water and enhance the health and vitality of the Texas communities we serve.”

Simon Sequeira, chief executive officer, Quadvest, said in a press release, “We are pleased to join TWC, combining our talent, experience, and vision to deliver lasting value for our customers, business partners, and communities. One of the main reasons we chose TWC is their respect for the brand and incredible team we have built at Quadvest. Together, we and TWC will unlock new opportunities for growth, innovation, and advancement for our people, while preserving the culture and vision that have always defined Quadvest. Combining with TWC will also enhance our ability to work with our business partners – including developers, builders, engineers, vendors, and community leaders – driving speed, flexibility, and the ability to get projects done. With increased capital, deeper operational capacity, and national backing, we believe we will be better positioned than ever to accelerate timelines, scale infrastructure, and deliver outstanding service. TWC and H2O America both share the deep dedication to quality, reliability, integrity, and local accountability that have driven Quadvest’s success for nearly 50 years.”

Leadership

Upon the completion of the combination, Ms. Williams will continue to serve as president of TWC.

Transaction details and financing

Pursuant to the first agreement, TWC will acquire regulated systems owned by Quadvest, L.P. for $483.6 million, and under the second agreement, TWOS will acquire systems owned by Quadvest Wholesale LLC for $56.4 million, for a combined transaction value of $540 million. The transaction will be financed by a combination of privately placed debt and equity infusions from H2O America. The transaction will be financed in a manner that allows H2O America to maintain its strong balance sheet and current credit ratings. The transaction is not subject to any financing condition.

Timing and closing conditions

The transaction was unanimously approved by the H2O America and TWC Boards of Directors. The transaction is expected to close by mid-2026, subject to customary closing conditions and approvals, including the approvals of the Public Utility Commission of Texas and expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.