American Water Works Company Moves Forward With Largest Privatization of a Muncipal System.Business Editors VOORHEES, N.J.--(BUSINESS WIRE)--Feb. 9, 2001 Pennsylvania Public Utility Commission Approves Purchase of City of Coatesville Water and Wastewater Assets American Water Works Company, Inc. (NYSE NYSE See: New York Stock Exchange :AWK (Aho Weinberger Kernighan) A Unix programming utility developed in 1977 by Alfred Aho, Peter Weinberger and Brian Kernighan. Due to its unique pattern-matching syntax, awk is often used in data retrieval and data transformation. ) announced today that its Pennsylvania subsidiary has received approval from the PA Public Utility Commission to purchase the water and wastewater assets of the City of Coatesville Authority (CCA (1) (Common Cryptographic Architecture) Cryptography software from IBM for MVS and DOS applications. (2) (Compatible Communications A ). The purchase, expected to close in 30 days, marks another milestone in the company's growth strategy. "The Coatesville system currently serves 8600 water customers and 6500 wastewater customers, making this purchase of municipally-owned assets the largest privatization privatization: see nationalization. privatization Transfer of government services or assets to the private sector. State-owned assets may be sold to private owners, or statutory restrictions on competition between privately and publicly owned project of its kind in the nation," noted J. James Barr, president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of American Water Works. "We are extremely pleased with the commission's decision and the hard work and perseverance of our management team in Pennsylvania." Privatization in the water industry is not new. However, most of the nation's large privatization projects to date have only involved transfer of operating responsibility, not asset ownership. It is estimated that the city will receive net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from the sale of $36 to $38 million after the repayment of outstanding debt. The City plans to invest that money in an irrevocable trust Irrevocable Trust A trust that, once its setup, cannot be changed at all. Notes: This is to prevent fraudulent activities. See also: Exemption Trust, Trust, Unit Trust Irrevocable trust A trust that is unable to be amended, altered, or revoked. . The income earned by that investment will be used for economic development and other civic needs. The city has already indicated its intention to reduce taxes $1.1 million, and invest in a 24-hour community center and business enterprise development program. "Privatization offers numerous community benefits. The CCA transaction provides tangible evidence of those benefits and will greatly strengthen our message as we reach out to other community leaders," Mr. Barr added. American Water Works Company is the largest, investor-owned water utility enterprise in the Unites States. Its subsidiaries serve approximately 10 million people in 23 states. |
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