Bryn Mawr-based Essential Utilities, a water, wastewater and natural gas provider, and New Jersey-based American Water Works Co., the largest regulated water and wastewater utility company in the United States, have approved an all-stock, tax-free merger with a pro forma market capitalization of approximately $40 billion and a combined enterprise value of approximately $63 billion.
The merger advances the company’s shared mission of delivering essential utility services, and creates a long-term capital investment profile.
Under the terms of the agreement, Essential shareholders will receive 0.305 shares of American Water for each share of Essential they own. The combined company, American Water, will be headquartered in Camden, N.J. Essential’s Bryn Mawr and Pittsburgh offices will continue to operate.
John Griffith, American Water president and CEO, will become president and CEO of the combined company. Christopher Franklin, Essential CEO and chairman, will serve as board of directors executive vice chairman and as executive sponsor of an integration task force. The combined company’s board of directors will have 15 members.
The deal is expected to close by the second quarter of 2027, subject to customary closing conditions. Once completed, American Water shareholders will own approximately 69 percent of the combined company and Essential shareholders will own approximately 31 percent.