H2O America Significantly Expands Texas Footprint with Texas Subsidiary’s Acquisition of Quadvest

Core Viewpoint - H2O America is acquiring Quadvest, significantly increasing its connections in Texas and enhancing its operational scale and financial diversification, with expectations for long-term EPS growth and positioning Texas as its second-largest utility operation by 2028 [1][4][7]. Company Overview - H2O America operates a national network of local water and wastewater utilities, focusing on delivering clean, high-quality water to communities [13][15]. - Quadvest is a major water and wastewater utility in Texas, serving over 47,000 active connections and having a strong development pipeline in the Houston area [2][16]. Transaction Details - The acquisition involves TWC acquiring regulated systems from Quadvest for $483.6 million and TWOS acquiring systems for $56.4 million, totaling $540 million [7]. - The transaction will be financed through a mix of privately placed debt and equity, ensuring H2O America maintains a strong balance sheet [7]. Strategic Implications - The combination is expected to increase H2O America's customer base in Texas from approximately 17% to 26% by 2029, enhancing its presence in one of the fastest-growing regions [3]. - The merger will create the second-largest investor-owned water and wastewater utility in Texas, with a combined active pipeline of about 96,000 connections under contract [3][4]. Future Plans - H2O America plans to invest over $500 million in Texas over the next five years, increasing its consolidated five-year capital spending plan to approximately $2.1 billion, a 6% increase [3][7]. - The leadership of TWC will remain intact, with Aundrea Williams continuing as president, ensuring continuity in operations and community engagement [6][5].