Veolia North America has acquired the rights to 23 water treatment and energy service contracts from American Water Works Company, Inc. for $27 million. The transaction will expand the municipal water business of Veolia as 110 new employees will join its North American operation.
As part of the sale agreement, 23 of American Water’s 33 operations and maintenance (O&M) contracts with municipalities and large industrial customers, along with incumbent employees, will transfer to Veolia.
Of the 23 new contracts, 13 are wastewater contracts, four are drinking water contracts, five are wastewater and drinking water contracts and one is a contract to provide steam and compressed air. Eighteen of these contracts are located in the United States in eight different states (Connecticut, Ohio, North Carolina, Illinois, Minnesota, Arizona, California and Washington), and five are located in Ontario, Canada. The move is also in line with Veolia’s strategy to establish a greater presence in the western United States, where six of the new contracts are located.
A few American Water contracts will be retained, including Camden, North Brunswick, and South Orange, N.J., and Godfrey, Ill., due to proximity to existing regulated service areas. The remaining retained contracts are being sold to others or are near end of contract and will terminate in a short period of time.
“We are excited to expand our water and energy services to these municipalities and industries, and welcome our new colleagues,” said VNA Chief Executive Officer Bill DiCroce.
American Water anticipates that the sale will close in the third quarter of 2018. In the meantime, Veolia and American Water are working closely to ensure a smooth transition for customers and employees. With this agreement, American Water’s market-based businesses consist of Military Services Group, Homeowner Services (with the recent addition of Pivotal Home Solutions) and Keystone Clearwater Solutions.
The new contracts represent a yearly turnover of $31.1 million, according to Veolia.
The Veolia Group is the global leader in optimized resource management. With nearly 169,000 employees worldwide, the Group designs and provides water, waste and energy management solutions that contribute to the sustainable development of communities and industries. In 2017, the Veolia Group supplied 96 million people with drinking water and 62 million people with wastewater service, produced nearly 55 million megawatt hours of energy and converted 47 million metric tons of waste into new materials and energy.
With a history dating back to 1886, American Water is the largest and most geographically diverse U.S. publicly-traded water and wastewater utility company. The company employs more than 6,900 dedicated professionals who provide regulated and market-based drinking water, wastewater and other related services to an estimated 15 million people in 46 states, the District of Columbia, and Ontario, Canada. More information can be found by visiting www.amwater.com.
