Aqua America will acquire Peoples in an all-cash transaction that reflects an enterprise value of $4.275 billion, which includes the assumption of approximately $1.3 billion of debt. This acquisition marks the creation of a new infrastructure company that will be uniquely positioned to have a powerful impact on improving the nation’s infrastructure reliability, quality of life and economic prosperity.
Peoples consists of Peoples Natural Gas Co., Peoples Gas Co. and Delta Natural Gas Co. The multi-platform entity brings together the second-largest U.S. water utility and fifth-largest U.S. stand-alone natural gas local distribution company (based on customers), and will serve 1.74 million customer connections, which represent approximately 5 million people. In 2019, the new company will have approximately $10.8 billion in assets and a projected U.S. regulated rate base of over $7.2 billion.
The transaction is not expected to have any impact on rates.
The combined enterprise will be among the largest publicly traded water utilities and natural gas local distribution companies in the U.S., uniquely positioned to meaningfully contribute to the nation’s natural gas and water infrastructure reliability. The transaction will bring together two companies that each have more than 130 years of service and proven track records of operational efficiency, complementary service territories and strong regulatory compliance.
Aqua will acquire Peoples from infrastructure funds managed by Sausalito, Calif.-based SteelRiver Infrastructure Partners.
The combined company will operate regulated utilities over a 10-state footprint and will have its largest concentration in Pennsylvania, which will account for more than 77 percent of the company’s total rate base. Aqua’s rate base is growing annually at approximately 7 percent (2019–2021) and Peoples’ rate base is growing annually at 8 to 10 percent (2019–2021), creating a strong combined growth trajectory.
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