U.S. Water News Online
BERLIN, Germany — RWE AG, Germany's second largest utility, has sold an additional 5 million shares of its U.S. unit, American Water Works Co., for more than $100 million to underwriters of its recent initial public offering.
The Essen-based electricity and gas company said in a statement it had completed the sale of about 5.17 million extra shares at $20.85 per share, or about $107.8 million.
RWE said the underwriters' purchase constituted the partial exercise of the over-allotment option to buy additional shares, bringing the total size of the offering to approximately 63.17 million shares of American Water, or approximately 40 percent of the outstanding shares. The company has said it intends to sell a majority stake.
Total net proceeds from the sale of American Water stakes now stand at $1.3 billion, the company said.
RWE said in April it sold 58 million shares in American Water at $21.50 a share, raising $1.2 billion. That put the IPO stake value about 600 million euros ($945 million) below its book value.
RWE said earlier this month its first-quarter profit slid almost 49 percent amid charges related to the American Water initial public offering, and as a result of the strong euro.
The Essen-based electricity and gas company earned 809 million euros ($1.24 billion) in the January-March period compared with 1.57 billion euros a year earlier. Still, RWE said selling the majority of the company would eventually benefit shareholders.
Shares of RWE rose 1.4 percent to close at at 81.60 euros ($128.59) in trading in Frankfurt.
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