Eversource Energy has announced a definitive agreement to sell Aquarion Water Company to the newly created Aquarion Water Authority (AWA), a public corporation established by the State of Connecticut. AWA will operate independently alongside the South Central Connecticut Regional Water Authority (RWA). The deal is valued at approximately $2.4 billion, which includes $1.6 billion in cash and $800 million of net debt to be settled at closing. This valuation is 1.7 times Aquarion’s rate base as of December 2024.
Eversource plans to use the sale proceeds to reduce its parent company debt and reinvest in its core electric and natural gas businesses, focusing on improving reliability and strengthening its financial position. The company expects to record a $300 million loss on the transaction in its Q4 2024 results, which includes an estimated $140 million in income tax expenses. Despite this, Eversource reaffirms its long-term earnings growth target of 5% to 7% annually through 2028.
Eversource Chairman, President and CEO Joe Nolan, said “Since our acquisition of Aquarion in 2017, we have built on Aquarion’s long standing track record of superior customer service, industry-leading reliability and operational success to help them become the largest investor-owned water utility in New England and seventh largest in the country. I would like to thank the Aquarion leadership team for its sound management and financial stewardship of the company and extend my sincere gratitude to all Aquarion employees for their tireless, customer-first focus on safety and exceptional service, consistent with our core values at Eversource. By prioritizing prudent investments with a focus on affordability, we’ve worked together to ensure Aquarion’s water service is among the best in New England.”
Nolan further added, “This transaction reinforces our commitment to our core electric and natural gas operations as the largest regulated utility in New England, allowing us to optimize our portfolio and strengthen our balance sheet while reinvesting capital to benefit our customers. We will continue to collaborate with all stakeholders across our service territories in Connecticut, Massachusetts and New Hampshire to deliver cost-effective solutions that ensure safe, reliable electric and natural gas service for our customers.”
Sunder Lakshminarayanan, RWA & AWA Interim President and CEO, mentioned “Through the AWA transaction, we are advancing our water utility’s regional supply strategy and are excited to put our organization’s 45-year track record of demonstrating the benefits of RWAs stewardship, expertise, regulation and organizational stability to work for Aquarion customers, communities and employees as a not-for-profit, quasi-public utility.
He also said, “Both the RWA and Aquarion share similar missions to be the service provider and employer of choice. We strive to do this by providing customers with the highest quality water and services at an affordable cost while protecting the environment, and creating a safe and positive workplace where all employees can do their best work on behalf of the customers and communities served.”
Aquarion, based in Bridgeport, Connecticut, provides water and wastewater services to nearly 250,000 customers across 72 cities and towns in Connecticut, Massachusetts, and New Hampshire. With over 360 employees, Aquarion ensures safe and reliable water service to more than 775,000 people. Established in 1857 as the Bridgeport Hydraulic Company, the company has grown steadily, particularly since its acquisition by Eversource in 2017.
Under Eversource’s ownership, Aquarion expanded its customer base by approximately 30,000 through six acquisitions, increasing its rate base by $200 million. Notable acquisitions include New England Service Company (CT, NH, MA) in 2021, The Torrington Water Company (CT) in 2022, and the Pinehills Water System in Plymouth (MA) in 2023. Aquarion also entered the wastewater business with the purchase of municipal systems in New Hartford (CT) in 2023 and Ansonia (CT) in 2024.
The sale of Aquarion to the newly created Aquarion Water Authority (AWA) is subject to regulatory approvals from the Connecticut Public Utilities Regulatory Authority, the Massachusetts Department of Public Utilities, and the New Hampshire Public Utilities Commission, as well as clearance under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions. The transaction is expected to close by late 2025. Citi and Morgan Stanley & Co. LLC advised Eversource Energy, with Ropes & Gray LLP serving as legal counsel. AWA received M&A advisory support from Barclays and legal counsel from Cravath, Swaine & Moore LLP.
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