California Water Service Enters into Agreement to Acquire Casa Loma Water Company and Palm Mutual Water Company
California Water Service (NYSE: CWT) has announced agreements to acquire two water utility systems in Bakersfield: Casa Loma Water Company and Palm Mutual Water Company. Casa Loma serves approximately 900 people through 237 residential and 11 commercial connections, while Palm Mutual serves 63 residential customers. Both systems are strategically located near Cal Water's existing operations, with Casa Loma being three miles from their Bakersfield Operations Center and Palm Mutual two miles from their Northeast Bakersfield Treatment Plant.
Cal Water already has interconnections with both systems and plans infrastructure upgrades to improve service quality. The acquisitions require California Public Utilities Commission approval, and Cal Water intends to implement its existing rate structure for the new customers through a Tier 2 Advice Letter.
California Water Service (NYSE: CWT) ha annunciato l'acquisizione di due sistemi idrici a Bakersfield: Casa Loma Water Company e Palm Mutual Water Company. Casa Loma serve circa 900 persone tramite 237 collegamenti residenziali e 11 commerciali, mentre Palm Mutual serve 63 clienti residenziali. Entrambi i sistemi sono strategicamente situati vicino alle operazioni esistenti di Cal Water, con Casa Loma a tre miglia dal loro Centro Operativo di Bakersfield e Palm Mutual a due miglia dal loro Impianto di Trattamento di Northeast Bakersfield.
Cal Water ha già interconnessioni con entrambi i sistemi e prevede aggiornamenti infrastrutturali per migliorare la qualità del servizio. Le acquisizioni richiedono l'approvazione della California Public Utilities Commission, e Cal Water intende applicare la propria struttura tariffaria esistente ai nuovi clienti tramite una Lettera di Consiglio di Livello 2 (Tier 2 Advice Letter).
California Water Service (NYSE: CWT) ha anunciado acuerdos para adquirir dos sistemas de servicios de agua en Bakersfield: Casa Loma Water Company y Palm Mutual Water Company. Casa Loma atiende aproximadamente a 900 personas a través de 237 conexiones residenciales y 11 comerciales, mientras que Palm Mutual atiende a 63 clientes residenciales. Ambos sistemas están ubicados estratégicamente cerca de las operaciones existentes de Cal Water, con Casa Loma a tres millas de su Centro de Operaciones en Bakersfield y Palm Mutual a dos millas de su Planta de Tratamiento Northeast Bakersfield.
Cal Water ya cuenta con interconexiones con ambos sistemas y planea realizar mejoras en la infraestructura para mejorar la calidad del servicio. Las adquisiciones requieren la aprobación de la Comisión de Servicios Públicos de California, y Cal Water tiene la intención de aplicar su estructura tarifaria actual para los nuevos clientes mediante una Carta de Asesoramiento de Nivel 2 (Tier 2 Advice Letter).
California Water Service (NYSE: CWT)는 베이커스필드에 위치한 두 개의 수도 시스템인 Casa Loma Water Company와 Palm Mutual Water Company를 인수하기로 합의했다고 발표했습니다. Casa Loma는 237개의 주거 연결과 11개의 상업 연결을 통해 약 900명을 서비스하며, Palm Mutual은 63명의 주거 고객을 서비스합니다. 두 시스템 모두 Cal Water의 기존 운영지 근처에 전략적으로 위치해 있으며, Casa Loma는 베이커스필드 운영 센터에서 3마일, Palm Mutual은 Northeast Bakersfield 처리 시설에서 2마일 떨어져 있습니다.
Cal Water는 이미 두 시스템과 상호 연결되어 있으며, 서비스 품질 향상을 위해 인프라 업그레이드를 계획하고 있습니다. 이번 인수는 캘리포니아 공공유틸리티 위원회의 승인을 필요로 하며, Cal Water는 새로운 고객에게 기존 요금 구조를 Tier 2 권고서(Advice Letter)를 통해 적용할 예정입니다.
California Water Service (NYSE : CWT) a annoncé des accords pour acquérir deux systèmes de distribution d'eau à Bakersfield : Casa Loma Water Company et Palm Mutual Water Company. Casa Loma dessert environ 900 personnes via 237 connexions résidentielles et 11 commerciales, tandis que Palm Mutual dessert 63 clients résidentiels. Les deux systèmes sont stratégiquement situés à proximité des opérations existantes de Cal Water, Casa Loma étant à trois miles de leur centre d'exploitation de Bakersfield et Palm Mutual à deux miles de leur station de traitement Northeast Bakersfield.
Cal Water dispose déjà d'interconnexions avec les deux systèmes et prévoit des améliorations des infrastructures pour améliorer la qualité du service. Ces acquisitions nécessitent l'approbation de la California Public Utilities Commission, et Cal Water a l'intention d'appliquer sa structure tarifaire existante aux nouveaux clients via une lettre de conseil de niveau 2 (Tier 2 Advice Letter).
California Water Service (NYSE: CWT) hat Vereinbarungen zum Erwerb von zwei Wasserversorgungssystemen in Bakersfield bekannt gegeben: Casa Loma Water Company und Palm Mutual Water Company. Casa Loma versorgt etwa 900 Personen über 237 Wohn- und 11 Gewerbeanschlüsse, während Palm Mutual 63 Wohnkunden bedient. Beide Systeme befinden sich strategisch günstig in der Nähe der bestehenden Betriebe von Cal Water, wobei Casa Loma drei Meilen vom Bakersfield Operations Center und Palm Mutual zwei Meilen von der Northeast Bakersfield Treatment Plant entfernt liegt.
Cal Water verfügt bereits über Verbindungen zu beiden Systemen und plant Infrastrukturverbesserungen zur Steigerung der Servicequalität. Die Übernahmen bedürfen der Genehmigung durch die California Public Utilities Commission, und Cal Water beabsichtigt, die bestehende Tarifstruktur für die neuen Kunden mittels eines Tier-2-Ratschreibens (Advice Letter) anzuwenden.
- Strategic expansion of service area in Bakersfield with existing interconnections
- Opportunity to improve infrastructure and service quality for acquired systems
- Immediate integration possible due to existing interties and proximity to Cal Water facilities
- Acquisitions require regulatory approval from CPUC
- Infrastructure upgrades will require capital investment
Insights
Cal Water's strategic acquisitions expand its Bakersfield customer base while leveraging existing infrastructure, enhancing long-term growth with minimal integration risk.
Cal Water's agreements to acquire Casa Loma and Palm Mutual water companies represent targeted bolt-on acquisitions that strategically expand the company's footprint in Bakersfield. The geographic proximity of these systems—just 2-3 miles from Cal Water's existing operations—creates immediate operational synergies and minimizes integration challenges.
The acquisition structure is particularly efficient: Cal Water already serves Palm Mutual through a master meter and has an existing intertie with Casa Loma. This infrastructure overlap means minimal capital investment for service initiation, though Cal Water has outlined plans for system upgrades to enhance fire flow, pressure, and bring infrastructure to company standards.
In terms of customer base expansion, Casa Loma adds 248 connections serving approximately 900 people, while Palm Mutual contributes 63 residential customers. While modest in size, these acquisitions demonstrate Cal Water's disciplined M&A approach targeting complementary systems within or adjacent to existing service territories.
From a regulatory perspective, the company's plan to file a Tier 2 Advice Letter requesting adoption of existing rates for new customers suggests a straightforward approval process. This regulatory strategy typically faces fewer hurdles than complex rate cases, though CPUC approval remains a necessary closing condition.
These transactions align with the broader utility sector trend of consolidation among smaller water systems, driven by increasing compliance requirements and infrastructure investment needs. For Cal Water, these acquisitions represent low-risk growth opportunities that leverage existing operational infrastructure while expanding the rate base in a familiar regulatory environment.
SAN JOSE, Calif., May 29, 2025 (GLOBE NEWSWIRE) -- California Water Service (Cal Water), the largest subsidiary of California Water Service Group (NYSE: CWT), has signed agreements with Casa Loma Water Company (Casa Loma) and Palm Mutual Water Company (Palm Mutual) to acquire both systems’ water utility assets.
Casa Loma serves about 900 people through 237 residential and 11 commercial customer connections. The system is located three miles from Cal Water’s Bakersfield Operations Center and is surrounded by Cal Water’s existing service area. Because Cal Water has an existing intertie with Casa Loma, Cal Water will begin delivering water to these new customers after the acquisition is completed. Cal Water intends to install additional interconnections to help improve fire flow and system pressure, and plans to upgrade the infrastructure to Cal Water standards.
Palm Mutual is located two miles from Cal Water’s Northeast Bakersfield Treatment Plant and serves 63 residential customers. Cal Water currently serves Palm Mutual through a master meter interconnection, since Palm Mutual does not own nor operate its own sources of supply. Cal Water anticipates upgrading the system’s infrastructure over time to facilitate consistent and high-quality operations.
Both acquisitions are subject to satisfactory closing conditions and approval by the California Public Utilities Commission (CPUC). Cal Water intends to file a Tier 2 Advice Letter requesting the adoption of existing Cal Water rates for the new customers.
“We applaud Palm Mutual Water Company and Casa Loma Water Company for putting the health and safety of their customers first. We look forward to providing our new customers the high level of service we provide to our other Bakersfield customers,” said Martin A. Kropelnicki, Cal Water Chairman and Chief Executive Officer.
About California Water Service
California Water Service provides high-quality, reliable water utility services to more than 2.1 million people statewide through 499,400 service connections. Cal Water’s purpose is to enhance the quality of life for customers and communities. To do so, it invests responsibly in water and wastewater infrastructure, sustainability initiatives, and community well-being. The company’s 1,200 employees live by a set of strong core values and share a commitment to protecting the planet, caring for people, and operating with the utmost integrity. The utility has been named one of “America’s Most Responsible Companies” and one of the “World’s Most Trustworthy Companies” by Newsweek, a USA Top Workplace, and a Great Place to Work®. More information is available at www.calwater.com.
This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (PSLRA). The forward-looking statements are intended to qualify under provisions of the federal securities laws for "safe harbor" treatment established by the PSLRA. Forward-looking statements in this news release are based on currently available information, expectations, estimates, assumptions and projections, and our management's beliefs, assumptions, judgments and expectations about us, the water utility industry and general economic conditions. These statements are not statements of historical fact. When used in our documents, statements that are not historical in nature, including words like will, would, expects, intends, plans, believes, may, could, estimates, assumes, anticipates, projects, progress, predicts, hopes, targets, forecasts, should, seeks, commits or variations of these words or similar expressions are intended to identify forward-looking statements. Examples of forward-looking statements in this news release include, but are not limited to, statements describing the expected benefits resulting from the Casa Loma and Palm Mutual acquisitions, regulatory approvals and filings related to the acquisitions, and Cal Water’s investment plans. Forward-looking statements are not guarantees of future performance. They are based on numerous assumptions that we believe are reasonable but are subject to uncertainty and risks. Actual results or outcomes may vary materially from what is contained in a forward-looking statement. Factors that may cause actual results or outcomes to be different than those expected or anticipated include, but are not limited to: ability to integrate the business and operate the Casa Loma and Palm Mutual systems in an effective and accretive manner; the outcome and timeliness of regulatory commissions' actions concerning rate relief and other matters, including with respect to the 2024 California GRC filing; changes in regulatory commissions’ policies and procedures; our ability to invest or apply the proceeds from the issuance of common stock in an accretive manner; federal governmental and state regulatory commissions’ decisions; consequences of eminent domain actions relating to our water systems; increased risk of inverse condemnation losses as a result of the impact of weather, climate change, and natural disasters; our ability to renew leases to operate water systems owned by others on beneficial terms; changes in California State Water Resources Control Board water quality standards; changes in environmental compliance and water quality requirements, such as the EPA’s finalization of a National Primary Drinking Water Regulation in 2024; electric power interruptions; housing and customer growth; the impact of opposition to rate increases; our ability to recover costs; availability of water supplies; issues with the implementation, maintenance or security of our information technology systems; civil disturbances or terrorist threats or acts; the adequacy of our efforts to mitigate physical and cyber security risks and threats; the ability of our ERM processes to identify or address risks adequately; labor relations matters as we negotiate with the unions; changes in customer water use patterns and the effects on conservation, including as a result of drought conditions; our ability to complete, in a timely manner or at all, successfully integrate, and achieve anticipated benefits from acquisitions; the impact of weather, climate change, natural disasters, including wildfires and landslides, and actual or threatened public health emergencies on our operations, water quality, water availability, water sales, and operating results and the adequacy of our emergency preparedness; restrictive covenants in or changes to the credit ratings on our current or future debt that could increase our financing costs or affect our ability to borrow, make payments on debt, or pay dividends; risks associated with expanding our business and operations geographically; the impact of stagnating or worsening business and economic conditions, including inflationary pressures, general economic slowdown, or a recession, changes in tariff policy and uncertainty regarding tariffs and other retaliatory trade measures, the interest rate environment, changes in monetary policy, adverse macroeconomic conditions as a result of geopolitical conflicts, and the prospect of a shutdown of the U.S. federal government; the impact of market conditions and volatility on unrealized gains or losses on our non-qualified benefit plan investments and our operating results; the impact of weather and timing of meter reads on our accrued unbilled revenue; the impact of evolving legal and regulatory requirements; the impact of the evolving U.S. political environment that has led to, in some cases, legal challenges and uncertainty around the funding, functioning, and policy priorities of U.S. federal regulatory agencies and the status of current and future regulations; and other risks and unforeseen events described in our most recent Annual Report on Form 10-K and our other SEC filings. In light of these risks, uncertainties and assumptions, investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. We are not under any obligation, and we expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events, or otherwise.
FAQ
What water companies is CWT acquiring in Bakersfield?
How many customers will CWT gain from these acquisitions?
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What regulatory approvals does CWT need for these acquisitions?
