|Connecticut Water Board Chair, Carol Wallace: Board Opens Bids for Company.|
CLINTON: After weeks of refusing to address a merger proposal by Eversource, the Connecticut Water Service [NASDAQ: CTWS] has announced it will begin new solicitation of bids for the purchase of the company.
In March the company announced it had agreed to a merger with the San Jose Water Group [SJW Group NYSE: SJW] and the companies filed merger papers on May 7.
The new company announcement includes that SWG has also agreed to the solicitation of new bids through July 4, 2018.
SWG itself surfaced as a target for acquisition by the California Water Service Group [NASDAQ: CWT] also based in San Jose after announcing its desire to merge with Connecticut Water. San Jose has rejected that offer, and affirmed its interest in the merger with CWS.
In the San Jose merger, Eric W. Thornburg would be the CEO and chairman of the combined company. Thornburg was CEO of CWS until last September when he resigned to become CEO of SJW.
Connecticut Water’s announcement says “public process will allow shareholders to have full confidence in the company's strategic direction and know that every viable alternative has been explored.”
Eversource had previously files with the SEC its intention to contact shareholders directly about its offer, and it contacted CTW shareholders in a letter on May 4.
The Blackstone Group and Vanguard Investment companies through a variety of investment funds are the most significant investors in all four companies owning between 25 and 30% of all four companies. Several other institutional investors are owners of all four companies as well
While the company’s board has agreed to reviewing new proposals it has not changed its view on the deal it wants, yet. In its release it specifically says that Eversource’s current offer is not deemed superior to it agreed merger with San Jose Water saying, “Eversource will be among those invited to participate, however, Connecticut Water reaffirmed that the Board does not believe that Eversource's current $63.50 per share proposal is a superior proposal to the SJW Group merger agreement. Moreover, the Connecticut Water Board has unanimously determined that it would not agree to a transaction with Eversource on the terms currently proposed, regardless of the outcome of the proposed SJW Group merger, because the Connecticut Water Board believes that the current Eversource proposal substantially undervalues Connecticut Water.”