Connecticut Water Service, Inc. Completes $7.4 million Acquisition of Crystal Water Utilities Corporation.

CLINTON, Conn.--(BUSINESS WIRE)--Sept. 30, 1999--

Connecticut Water Service, Inc. (NASDAQ:CTWS), the Clinton, Connecticut based parent of The Connecticut Water Company, has acquired the Crystal Water Company, a Danielson, Connecticut based water utility with nearly 3,500 customers. Crystal shareholders received 2.46 shares of Connecticut Water Service common stock for each share of Crystal common stock they owned, the transaction is valued at $7.4 million. Crystal will operate as a wholly-owned subsidiary of Connecticut Water Service under its holding company structure.

Marshall T. Chiaraluce, President, CEO and Chairman of Connecticut Water Service, Inc. says the acquisition is in-line with the Company's strategy to increase shareholder value by investing in eastern Connecticut. He notes, "Since 1995 we have expanded our customer base by more than 5,500 customers, or 8 percent, by successfully acquiring seven small water utilities in eastern Connecticut. We are in a position to further expand the customer base by growing our water systems to meet the population growth and business expansion that is forecast for the region."

The Connecticut Department of Public Utility Control in approving the acquisition noted that "The customers of Crystal will benefit from this acquisition through CWS' experience, greater resources and better access to financial markets." Crystal's existing rates will remain in effect and its operations center and employees will remain in Danielson.

Connecticut Water Service, Inc., the state's second largest investor-owned water utility, is the holding company for The Connecticut Water Company, The Gallup Water Company and Connecticut Water Utility Services, Inc. Connecticut Water Company serves nearly 64,000 customers in 35 Connecticut towns. Connecticut Water Utility Services is an unregulated subsidiary providing water related services to businesses, municipalities and water utilities.

Crystal serves nearly 3,500 customers in the towns of Killingly, Brooklyn, Thompson and Plainfield. In addition, Crystal has approximately 300 contiguous acres of land that may be available for sale at some time in the future.

Connecticut Water Service reported water revenues of $ 37.9 million in 1998 with 63,798 billing customers. Crystal reported 1998 water revenues of $1.9 million with 3,500 billing customers for the same period.

Connecticut Water Service, Inc. (NASDAQ: CTWS) - www.ctwater.com is a non-operating holding company whose income is derived entirely from its subsidiaries. The principal business is water service to 64,000 residential, commercial, industrial and municipal customers throughout 35 towns in Connecticut. CTWS provides water service to more Connecticut towns than any other Connecticut water company. The company was founded in 1956 and its subsidiary, The Connecticut Water Company, has water distribution experience dating back to 1866. CTWS is one of the 12 publicly traded, investor owned water utility stocks in the U.S.