Pennichuck Corporation (NASDAQ: PNNW) today announced that on
Friday, February 4, 2011, the City of Nashua, New Hampshire (the
"City") and the Company filed a joint petition with the New
Hampshire Public Utilities Commission ("NHPUC") requesting that the
NHPUC approve the acquisition of the Company by the City pursuant
to a Merger Agreement made effective as of November 11, 2010.
On November 12, 2010, the Company announced that it had entered
into a Merger Agreement with the City pursuant to which the City
will purchase all of the outstanding common stock and common stock
equivalents of the Company for $29.00 per share, or approximately
$138 million, in cash. At that time, the Company also announced
that, among other conditions precedent and contingencies, (a)
consummation of the transaction is subject to advance approval by
the NHPUC pursuant to New Hampshire law, and (b) the City's
obligation to complete the transaction is subject to there being no
approval conditions imposed by the NHPUC that would materially
adversely affect the City's expected economic benefits from the
transaction.
The Company cannot predict how or when the NHPUC will rule on
the transaction. However, the Company believes the review process,
which is expected to begin on or about February 24, 2011 and will
include notice to interested parties, public hearings, discovery
and testimony by the City, the Company and other interested
parties, may extend into the third or fourth quarter of calendar
2011.
Closing of this transaction is also subject to (i) approval and
ratification of the Merger Agreement and the related financing by
affirmative vote of not less than two-thirds of the City's Board of
Aldermen within a 90-day period set by law, (ii) approval by the
holders of not less than two-thirds of the outstanding shares of
the Company's common stock, and (iii) Nashua's ability to obtain
appropriate financing after all conditions precedent (including
those specified above and other customary closing conditions) have
been met.
On January 11, 2011, the Board of Aldermen voted 14 to 1 to
approve and ratify the Merger Agreement and the issuance of bonds
to finance the acquisition. For more information on this topic, see
the Company's press releases issued on June 2, June 30 and November
12, 2010, the related Form 8-K filings with the U.S. Securities and
Exchange Commission (the "SEC"), and the Company's Quarterly Report
on Form 10-Q for the quarter ended September 30, 2010, also filed
with the SEC.
Commenting on the acquisition, Duane C. Montopoli, Pennichuck's
President and Chief Executive, said, "This stock sale will enable
our shareholders to avoid double-taxation and the City will acquire
more assets at a lower total cost than would have applied in a
condemnation taking. Consequently, this is a true win-win outcome
for both the Company's shareholders and the citizens of
Nashua."
He added, "I am also very pleased to note that we have been able
to resolve this dispute in a manner that will allow our workforce
to continue providing exceptional service to the customers and
communities we serve."
While the Company and the City remain committed to completing
this transaction as quickly as possible, it is not possible to
predict whether all the approvals, contingencies and other
conditions precedent to closing will be obtained, resolved or
satisfied, as applicable, and therefore if and when the transaction
will close.
About Pennichuck Corporation
Pennichuck Corporation is a holding company involved principally
in the supply and distribution of potable water in New Hampshire
through its three regulated water utilities. Its non-regulated,
water-related activities include operations and maintenance
contracts with municipalities and private entities in New Hampshire
and Massachusetts. The Company's real estate operations are
involved in the ownership, management and commercialization of real
estate in southern New Hampshire.
Pennichuck Corporation's common stock trades on the Nasdaq
Global Market under the symbol "PNNW." Upon completion of the
transaction, Pennichuck's common stock will cease to be publicly
traded. The Company's website is at www.pennichuck.com.
Forward-Looking Statements
This news release may contain certain forward-looking statements
with respect to the financial condition, results of operations and
business of Pennichuck Corporation. Forward-looking statements are
based on current information and expectations available to
management at the time the statements are made, and are subject to
various factors, risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by
such forward-looking statements. These factors include, but are not
limited to, a future judicial or regulatory determination that
events prior to the November 11, 2010 effective date of our merger
agreement with the City of Nashua constituted a final determination
of the price to be paid under RSA 38:13 and triggered the statutory
90-day period within which the City was required to decide whether
to take, by eminent domain, the assets of our Pennichuck Water
Works, Inc. subsidiary; the expiration of said 90-day period
without the City having made any such decision; the outcome of
requests for rate relief from the NHPUC from time to time; the
implications of the New Hampshire Supreme Court's March 25, 2010
decision affirming the eminent domain order of the NHPUC in favor
of the City of Nashua; legislation and/or regulation and accounting
factors affecting Pennichuck Corporation's financial condition and
results of operations; the availability and cost of capital,
including the impact on our borrowing costs of changes in interest
rates; and, the impact of weather. Investors are encouraged to
access Pennichuck Corporation's annual and quarterly periodic
reports filed with the Securities and Exchange Commission for
financial and business information regarding Pennichuck
Corporation, including a more detailed discussion of these and
other risks and uncertainties that could affect Pennichuck
Corporation's forward-looking statements. We undertake no
obligation to update or revise publicly any forward-looking
statement.
Additional Information and Where to Find
It
Pennichuck Corporation plans to file with the U.S. Securities
and Exchange Commission and mail to its shareholders a proxy
statement in connection with the transaction (the "Proxy
Statement"). The Proxy Statement will contain important information
about Pennichuck Corporation, the proposed acquisition by the City
of Nashua and related matters. EXISTING AND PROSPECTIVE PENNICHUCK
CORPORATION SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT
REGARDING THE PROPOSED TRANSACTION WHEN IT BECOMES AVAILABLE AND
ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY
AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
Pennichuck Corporation security holders will be able to obtain
free copies of the Proxy Statement and other documents filed with
the SEC by Pennichuck Corporation through the web site maintained
by the SEC at www.sec.gov. In addition, documents filed by
Pennichuck Corporation with the SEC, including filings that will be
incorporated by reference in the Proxy Statement, can be obtained,
without charge, upon written request addressed to Roland E.
Olivier, Secretary, Pennichuck Corporation, 25 Manchester Street,
Merrimack, New Hampshire 03054.
Participants in the Solicitation
Pennichuck Corporation, its directors, executive officers and
other members of management, and the City of Nashua and its
officials and employees may be deemed to be participants in the
solicitation of proxies in respect of the acquisition contemplated
by the merger agreement. Information regarding Pennichuck
Corporation's directors and executive officers is contained in
Pennichuck Corporation's Annual Report on Form 10-K for the year
ended December 31, 2009, as filed with the SEC on March 4, 2010,
and its proxy statement for its 2010 annual meeting, as filed with
the SEC on March 26, 2010. Information about the City and its
officials can be found at http://www.gonashua.com. Additional
information regarding the interests of those participants may be
obtained by reading the Proxy Statement regarding the proposed
transaction when it becomes available. EXISTING AND PROSPECTIVE
SECURITY HOLDERS SHOULD READ THE PROXY STATEMENT AND OTHER
DOCUMENTS TO BE FILED WITH THE SEC CAREFULLY BEFORE MAKING AN
INVESTMENT DECISION WITH RESPECT TO PENNICHUCK CORPORATION
SECURITIES.
For More Information, Contact: Duane C. Montopoli,
President and Chief Executive Officer Phone: 603-913-2300 Fax:
603-913-2305
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