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Connecticut
Water Completes Acquisition of
Avery Heights Water System
Clinton,
Connecticut, March 19, 2007 – Connecticut Water
Service, Inc. (Nasdaq GS: CTWS) has announced that its regulated
water utility subsidiary, The Connecticut Water Company, has
completed the acquisition of the Avery Heights Water System
in South Windsor, Connecticut. The Avery Heights Homeowner’s
Association transferred the assets of the water system and
its 216 customers at no cost to Connecticut Water.
On
January 19, 2007, the Avery Heights Homeowners Association
had applied to the Connecticut Department of Public Utility
Control (DPUC) for approval to transfer its water systems
assets to Connecticut Water. The DPUC determined that Avery
Heights did not constitute a water ‘company’ and
therefore DPUC approval was not required. This allowed the
transfer of assets to proceed quicker than had been anticipated.
The
Avery Heights water system, which had its own ground water
sources, has experienced episodes of discolored water. Immediately
following the completion of the acquisition, the Avery Heights
system’s existing sources of supply were disconnected
and customers began receiving their water from Connecticut
Water’s distribution system through a $100,000 water
main extension.
Eric
W. Thornburg, President and CEO of Connecticut Water, notes
that this acquisition fits the Company’s strategy of
serving our customers, shareholders, and employees. Mr. Thornburg
states, “As the state’s largest publicly traded
water utility, we are in a position to improve service and
water quality for our new customers at Avery Heights, while
earning a return for our shareholders on our infrastructure
investment, and our existing customers benefit from having
a larger customer base to spread fixed costs. In addition,
acquisitions also help to create advancement opportunities
for our dedicated skilled employees.” Mr. Thornburg
notes that in 2006, Connecticut Water achieved an 85 percent
customer satisfaction rating, which is considered world-class;
and has had the lowest customer complaint rate among Connecticut’s
major utilities for four years in a row.
This
is the second acquisition completed by Connecticut in less
than six months. The Company completed the acquisition of
the 123 customer South Coventry Water Supply Company last
Fall. Excluding Avery Heights and South Coventry, Connecticut
Water has acquired 12 water systems over the past dozen years
and the additional customers from these acquisitions represent
about 14 percent of the company’s current base.
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Connecticut Water Service,
Inc. is the largest, domestic-based, investor-owned water
utility in New England. It provides water to over 83,000 or
286,000 people customers in 41 towns in Connecticut, as well
as providing water-related services under contract to municipalities
and companies.
This news release may
contain certain forward-looking statements regarding the Company’s
results of operations and financial position. These forward-looking
statements are based on current information and expectations,
and are subject to risks and uncertainties, which could cause
the Company’s actual results to differ materially from
expected results.
The Connecticut Water
Company is subject to various federal and state regulatory
agencies concerning water quality and environmental standards.
Generally, the water industry is materially dependent on the
adequacy of approved rates to allow for a fair rate of return
on the investment in utility plant. The ability to maintain
our operating costs at the lowest possible level while providing
good quality water service is beneficial to customers and
stockholders. Profitability is also dependent on the timeliness
and amount of rate relief and numerous factors over which
we have little or no control, such as the quantity of rainfall
and temperature, industrial demand, financing costs, energy
rates, tax rates, and stock market trends which may affect
the return earned on pension assets, and compliance with environmental
and water quality regulations. The profitability of our other
revenue sources is subject to the amount of land we have available
for sale and/or donation, the demand for the land, the continuation
of the current state tax benefits relating to the donation
of land for open space purposes, regulatory approval of land
dispositions, the demand for telecommunications antenna site
leases and the successful extensions and expansion of our
service contracts. We undertake no obligation to update or
revise forward-looking statements, whether as a result of
new information, future events, or otherwise.
# # #
News media contact:
Daniel J.
Meaney, APR
Director of Corporate Communications
Connecticut Water Service, Inc.
93 West Main Street, Clinton, CT 06413-1600
(860) 669-8630: Ext. 3016
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