AUGUSTA, Maine — The Maine Public Utilities Commission on Wednesday approved the acquisition of Biddeford & Saco Water Co. by a Connecticut utility in a deal that if finalized would create the largest investor-owned water utility in Maine.
Connecticut Water Service, based in Clinton, Conn., wants to buy Biddeford & Saco Water Co., or BSWC, which serves nearly 16,000 customers in Biddeford, Saco, Old Orchard Beach and Scarborough, for $19.8 million.
The Connecticut water company is not new to the Maine market. In January it acquired Aqua Maine Inc., which serves nearly 16,000 customers in 17 communities throughout Maine. That company is now known as Maine Water Co.
It now wants to acquire BSWC and merge it with Maine Water. If finalized, the merged companies would have 32,000 customers serving close to 100,000 people, creating the largest investor-owned water utility in the state, according to a media release from Connecticut Water.
The Maine PUC reviewed Connecticut Water’s proposed acquisition of BSWC and determined the deal is “consistent with the interests of the ratepayers and investors” and “not adverse to the public interest,” according to its report.
As part of the approval process, Connecticut Water and BSWC had to agree that the water drawn from the Saco River, BSWC’s source, would not be used “for purposes other than providing water to ratepayers in the communities served” by BSWC, and that the companies would “not bottle water from the Saco River for commercial sales outside of BSWC service territory.”
Judy Wallingford, president of Maine Water, told the Journal Tribune that BSWC’s charter states that only the communities served by that company can use the Saco River as a water source.
BSWC is in favor of being acquired because it will allow it to make investments to improve the local water system.
“The increased access to capital by becoming a part of Maine Water and CTWS allows for greater infrastructure investment to maintain and improve the system, which is needed for future economic development as well public health and safety,” Jerry Mansfield, BSWC’s president, said in a statement.
To improve the area water system, BSW’s customers will experience a 20 percent increase in rates a year after the merger, according to the Journal Tribune.
Biddeford & Saco Water’s shareholders still need to approve the acquisition. Pending that approval, the deal is expected to close in December 2012.