American Water Works and Essential Utilities are merging in an all-stock deal, creating a $40 billion public water utility. The combined company, to be named American Water, will have 4.7 million water connections across 17 states and 18 military installations. Shareholders will receive 0.305 shares of American Water for each Essential share.

Customer rates will not change due to the merger. American Water plans to review strategic options for non-water businesses post-merger. There will be no significant changes to employee compensation or benefits, with union contracts honored. CEO John Griffith highlighted enhanced scale and operational efficiency supporting infrastructure investment.

Griffith will be president and CEO of the combined company, with Essential’s CEO becoming executive vice chair. The board will consist of 15 members, including existing American Water directors and five designated by Essential. The company will be headquartered in Camden, NJ, with operations in Bryn Mawr and Pittsburgh.

The merger is set to close by the end of the first quarter of 2027, pending shareholder and regulatory approvals. American Water Works’ shares fell 3.5% in morning trading, while Essential Utilities’ stock saw a slight decline.

Read more at Yahoo Finance: American Water Works, Essential Utilities to merge