RWE to Sell 36 Percent of American Water, Take Charge (Update2)
RWE to Sell 36 Percent of American Water, Take Charge (Update2)
By Nicholas Comfort
April 23 (Bloomberg) — RWE AG, Germany's second-largest utility, said it will sell 36 percent of its U.S. unit, American Water Works Co., resulting in a maximum 600 million euro ($958 million) charge that will cause 2008 profit to be slightly below last year's level.
The utility will sell 58 million shares at $21.50 each to raise $1.2 billion, the company said in a statement on DBF newswire today. Trading will start April 23 on the New York stock exchange. For 2008, the company previously forecast profit growth of more than 10 percent.
Chief Executive Officer Juergen Grossmann said April 17 that RWE wanted to hold an initial public offering this month, in which a 40 percent stake in the U.S. unit would be sold. RWE will be able to make higher dividend payouts next year once it sells a majority of its American Water shares, he said at the time. In 2006, the company completed a 4.8 billion pound ($9.6 billion) sale of unit Thames Water to a group led by Macquarie Group Ltd. to focus on providing electricity and natural gas.
“The climate on the stock exchange for a defensive business model like that of American Water has improved somewhat,'' Grossmann said. “Providing capital market conditions stay favorable, we are committed to divesting the majority of our share in American water within the current year.''
RWE has granted the underwriters a 30-day option to purchase up to 8.7 million additional shares of common stock, American Water said in its own statement today. RWE spokeswoman Julia Scharlemann had said April 17 that the underwriting banks may buy as many as 9.6 million additional shares from RWE.
The U.S. division would offer 64 million common shares at a range of $24 to $26 each, according to a preliminary prospectus filed March 31 with the U.S. Securities and Exchange Commission.
Tags: american, water, works
depends on what you eat your algae and plankton with. Mmmmm… algae…
How is tap water in England? You don’t have fluoride, do you?
Go to France and you can get the stuff on tap at most vinyards. You tend to see local restaurant owners popping round with a steel bucket to fill up with wine straight from a tap. Works out at cost price too - around a Euro per litre.
^ would like to know what research went into that “best” and “safest” part. You do know that fluoride is a poison, right ?
Caption said “Even though we have some of the best and safest tap water in the world …” That says to me that it’s merely among the best. It’s certainly better than the water in just about every South American, African and Asian nation.
The water must be flavored for bottle consumption to be justified! Powdered drink mixes are crap!
It’s a bogus argument though, those bottles are being made anyway for Coke, Pepsi and the like.In the end the product is 99% the same, it’s just a little extra chemicals, colorings and flavors that make the difference.Is bottled water worse than drinking free water? Sure.Is it better than drinking Coke/Pepsi? By a long shot.
I learned that from looking at a bottle of water and saying “Hey…that’s Naive spelled backwards! Suddenly the world makes a little more sense!”
For those who don’t like tap water, just buy a water filtering jug (or get a filter fitted to your tap)…much cheaper and improved the taste.