The O’Melveny Monthly Water Report includes select transactions and other items of interest occurring during May 2018. Please contact any member of the O’Melveny Water Practice for additional information on any of these items or any related items.
In May 2018, tracked deals included several financings as well as steady acquisition activity. Private financings were tracked in Australia, Canada, China, and the United States. A California-based social business providing drinking water to communities in primarily underserved rural areas internationally raised $3.5 million in a mix of equity and debt offerings. Acquisition activity was tracked in Finland, Japan, the UK, the United States, and Vietnam. May deal volume tracked drinking water and filtration technology companies and small water utility acquisitions in the United States, as well as a large chemical company acquisition and a cannabis products company.
Mergers & Acquisitions
Riverland Water Holdings Pty Ltd
Riverland Water Holdings Pty Ltd
May 2, 2018
AMP Capital Community Infrastructure Fund managed by AMP Capital Investors Limited acquired the remaining 50% stake in Riverland Water Holdings Pty Ltd from TRILITY Pty Ltd. AMP and now holds 100% stake in Riverland Water. Based in Adelaide, Australia, Riverland Water provides municipal water treatment services and supplies drinking water. TRILITY provides water utility solutions for municipal and industrial sectors in Australia. It engages in designing, building, operating, and maintaining critical water, water reuse, bio solids, and wastewater infrastructure. AMP Capital Funds - Global Listed Infrastructure Fund is an open-end fund incorporated in Luxembourg. The Fund invests in a global diversified portfolio of listed infrastructure securities.
Pennsylvania-American Water Company, Inc.
Pennsylvania-American Water Company, Inc. entered into an agreement to acquire wastewater assets of Sadsbury Township in Chester County, Pennsylvania for approximately $9.3 million. The transaction is subject to approval from the Pennsylvania Public Utility Commission and other necessary approvals from the Pennsylvania Department of Environmental Protection. Headquartered in Hershey, Pennsylvania, the Pennsylvania-American Water Company is a utility company in the State of Pennsylvania that provides water and sewage services to more than 2 million people within the state. Pennsylvania-American Water Company, Inc. is a subsidiary of American Water Works Company, Inc., providing regulated and market-based drinking water, wastewater, and other related services to an estimated 15 million people in 47 states of the United States and Ontario, Canada.
Harvest One Cannabis Inc. (TSXV:HVT)
May 3, 2018
Harvest One Cannabis Inc. (TSXV:HVT) entered into definitive agreements to acquire Dream Products, LLC. and Dream Water Products Canada Inc. for $26.69 million. As part of this transaction, the combination of Dream Water Canada and Dream Water USA will become Dream Water Global and own the worldwide rights and all intellectual property to and for Dream Water. Harvest One Cannabis Inc. operates as a global cannabis company. The company develops cannabis medicines for treatment of various diseases and serves medical and recreational cannabis markets worldwide. Dream Products, LLC. manufactures sleep and relaxation water-based beverages. It offers Dream Water, water that helps users to relax and fall asleep. The company offers its products through distributors and retailers, as well as online. Dream Products was founded in 2009, and is based in Hollywood, Florida.
Solenis International LP
May 3, 2018
Solenis International LP signed an agreement to acquire the paper and water chemicals business of BASF SE. Following the completion, BASF would own a 49% stake in the combined entity while the remaining 51% stake would be held by funds managed by Clayton, Dubilier & Rice and would continue to operate under the Solenis brand and be headquartered in Delaware, United States. Solenis International LP manufactures specialty chemicals for process, water treatment, and monitoring and control systems and serves customers in various heavy industries. BASF Corporation manufactures and supplies basic chemicals and intermediates.
Water Intelligence plc
May 15, 2018
Water Intelligence plc (AIM:WATR) acquired its American Leak Detection South Florida franchise. Consideration for the acquisition will be paid out over a number of years. The acquired operation will be combined with Water Intelligence’s corporate operation located immediately to the north, spanning Ft. Lauderdale and Miami. Water Intelligence plc provides leak detection and remediation products and services for residential, commercial, and municipal customers in the United States, the United Kingdom, and internationally. American Leak Detection South Florida Franchise comprises environmental and technology services, such as detecting, finding, and remediating water leaks.
Castle Water Ltd
Castle Water Ltd acquired Invicta Water Limited. Based in Blairgowrie, United Kingdom, Castle Water Ltd retails water to businesses, charities, and public bodies in the United Kingdom. It also provides various services in the areas of water efficiency auditing, leak detection and repair, meter installation, water recycling, as well as technical, design, engineering and project management services. Invicta Water Limited provides water services to businesses. Invicta was founded in 1995 and is based in Snodland, United Kingdom.
| Global Fertigation Solutions Inc. |
Global Fertigation Solutions Inc.
May 17, 2018
Global Fertigation Solutions Inc. agreed to acquire certain assets of Hanson's Water Treatment Inc. for $1.37 million. Fertigation is the injection of fertilizers, soil amendments, and other water soluble products into an irrigation system. Hanson's Water Treatment Inc. provides water treatment equipment and serves customers in Nevada.
American Water Works Company, Inc. (NYSE:AWK), the parent of American Water Enterprises, has commenced a registered underwritten offering of 2.32 million shares of its common stock. Nicor Energy Ventures Company, doing business as Central Valley Gas Storage owns and operates natural gas storage facilities. The company was founded in 1994, and is based in Princeton, California.
| NW Natural Water Company, LLC |
NW Natural Water Company, LLC entered into an agreement to acquire Lehman Enterprises, Inc. and Sea View Water LLC. The assets and operations of Lehman and Sea View will be combined under a newly-formed subsidiary of NW Natural Water. Northwest Natural Gas Company engages in gas distribution and storage businesses in the United States. Lehman and Sea View are water utilities in Washington state. Both are located on Whidbey Island near Seattle in Puget Sound. Lehman Enterprises, Inc. serves about 900 customers and Sea View Water LLC serves just under 200 customers. Washington Transportation and the Utilities Commission are expected to close in 2018.
| Gem Water Utility Gem Water Utility |
NineStar Connect, a smart utility providing water, sewer, electric and high-speed fiber services, announced that the Town of Cumberland voted to accept its offer to acquire Gem Water Utility, which the town has owned since 2010. As part of the acquisition, NineStar Connect will retire Cumberland’s bond debt for Gem Water Utility, and has committed its Central Indiana Communications, Inc. (CICI) for-profit communications subsidiary to build a fiber optic network that connects Cumberland’s town hall and other municipal facilities, including municipal parks and trails. Gem Utilities serves approximately 500 water customers and with this acquisition, NineStar’s water customer base will go from 100 to 600 water customers.
Water Technologies International, Inc.
Water Technologies International, Inc. (OTCPK:WTII) acquired Water Zone Inc. Water Technologies, incorporated on August 10, 2005, and is a holding company engaged in designing, manufacturing, and distributing atmospheric water generators and related products. The Company offers products in water generation, air filtration, water filtration and dehumidification. Water Zone is a commercial, industrial, and residential water treatment company, incorporated in 1989, and based in West Palm Beach, Florida.
| CA MAU WATER SUPPLY JOINT STOCK COMPANY |
CA MAU WATER SUPPLY JOINT STOCK COMPANY
May 30, 2018
DNP Investment Management Joint Stock Company acquired a 10% stake in Ca Mau Water Supply Joint Stock Company. Ca Mau supplies water and was founded in 1975, and is headquartered in Ca Mau, Vietnam.
Kurita Water Industries Ltd. (TSE:6370) agreed to acquire an unknown stake in Fracta, Inc. from existing shareholders. Fracta uses machine learning and big data to optimize infrastructure investments – starting with a water main pipe replacement prioritization solution for U.S. water utilities. Kurita Water Industries Ltd. provides various water treatment solutions in Japan, other countries in Asia, North America, Europe, the Middle East, Africa. Kurita Water Industries Ltd. was founded in 1949, and is headquartered in Tokyo, Japan.
Evac Oy acquired certain assets of Cathelco Ltd, including Cathelco’s pipework anti-fouling, hull corrosion protection, fresh water generation and ballast water treatment systems that will become part of the Evac Complete Cleantech Solution. Cathelco Ltd. designs and manufactures equipment for ships and offshore installations. Evac Oy designs, manufactures, and markets waste and wastewater collection and treatment solutions for shipbuilding, offshore, and construction industries worldwide. Evac Oy was founded in 1975, and is based in Espoo, Finland.
Nestlé Waters UK Ltd. acquired an unknown majority stake in Princes Gate Spring Water Ltd., which was founded in 1991. and is based in Narberth, United Kingdom. Princes Gate Spring Water Ltd. produces bottled water. Nestlé Waters UK Ltd., a subsidiary of Nestle Waters S.A., produces bottled water and is based in Gatwick, United Kingdom.
Public & Private Financings
| The Alkaline Water Company Inc. (OTCPK:WTER) |
The Alkaline Water Company Inc. (OTCPK:WTER) announced a non-brokered private placement of 5,333,333 units at $0.75 per unit for gross proceeds of approximately $4 million. The Alkaline Water Company produces bottled alkaline water products for retail consumers and is headquartered in Scottsdale, Arizona.
WaterHealth International, Inc.
WaterHealth International, Inc. announced that it will receive $3.5 million in funding by issuing convertible debt in the transaction as well as securities pursuant to exemption provided under Regulation D. WaterHealth International is a private corporation headquartered in Irvine, California operating as a social business that provides drinking water to communities in primarily rural areas. WaterHealth International installs, operates, and maintains water purification plants for underserved communities in India, Bangladesh, the Philippines, Ghana, Nigeria, and Liberia.
Ozner Water International Holding Limited
Ozner Water International Holding Limited (SEHK: 2014) is offering a maximum of 90,000,000 new shares under placing, on a best effort basis. Ozner Water, an investment holding company, engages in water purification, air sanitization, supply chain, and other businesses in the People’s Republic of China, was incorporated in 2013, and is headquartered in Shanghai.
Clearford Water Systems Inc. (TSXV:CLI) announced a private placement of convertible debentures for gross proceeds of approximately $1.2 million. The convertible debentures have a term of five years and bears interest at 5% compounded annually. Clearford Water designs and constructs communal water and wastewater infrastructure systems. The company also provides engineering and design services.
DAYU Water-saving Group Co. Ltd.
DAYU Water-saving Group Co. Ltd.
DAYU Water-saving Group Co. LTD (SZSE:300021) announced a share repurchase program of up to a maximum of 5,000,000 shares, at a purchase price not exceeding $1.56 per share, for a total consideration of $7.8 million. The repurchase program will be funded from the company's self-raised funds. Dayu Water is a China-based supplier of water saving irrigation system products. The Company is primarily engaged in the research, development, manufacture, and distribution of water saving materials, as well as the design, construction, and services of water-saving irrigation projects.
Waterjet Robotics U.S.A., LLC
Waterjet Robotics U.S.A., LLC announced that it has received funding from new investor, Decathlon Capital Partners. Based in Palm City, Florida, Waterjet Robotics U.S.A., LLC manufactures automated waterjetting technology to remove heavy-duty marine and industrial coatings. Decathlon Capital Partners, based in Park City, Utah, is a private equity firm founded in 2010.
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