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Strategies & Market Trends : Water! Water! Everywhere and Not a Drop To Drink!

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To: Wade who wrote (229)	7/15/1999 9:06:00 AM
From: Mike 2.0	Read Replies (3) of 336

UWR: What does thread make of this news bit. Why would UWR do this? Are they that strapped for cash, or are there other reasons? 05:46 AM ET 07/14/99 United Water to sell small utilities for $49 mln HARRINGTON PARK, N.J., July 14 (Reuters) - United Water Resources said it has agreed to sell several small utility subsidiaries in Illinois, Indiana, Missouri and Virginia to American Water Works Co for about $49 million in cash. United Water, which provides water and wastewater service to more than 7.5 million people in 19 states, also said it will offer a voluntary early retirement programme to 90 employees who qualify based on age and length of service. The company estimates that the programme will result in a workforce reduction of about 4 percent of the company's 1,400 employees and a one-time cost of about $5 million to be incurred during 1999. The company expects that the impact of this cost on United Water's 1999 net income will partially offset the anticipated gain on the utility properties. The operations to be sold were acquired through United Water's 1994 merger with GWC Corp. and represent less than 4 percent of the company's regulated assets and under 2 percent of the population it serves. "This prospective sale is part of a strategic restructuring of our utility portfolio aimed at enhancing the return on our regulated investments." said Donald Correll, chairman and chief executive officer of United Water. "We are committed to strengthening our core utility business by focusing our efforts in service areas that are experiencing significant growth and development," he added. Correll said that United Water will continue to pursue its growth strategy, which includes the acquisition of regulated water and wastewater utilities, expanding its existing regulated utilities and strategic alliances to seek water-related business opportunities. The transactions, which are subject to regulatory approvals from state public service commissions, are expected to close during 1999 as various approvals are received. (( New York Newsdesk (212) 859-1999 ))

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