Essential Utilities (WTRG) advances workforce integration for planned American Water merger

Rhea-AI Filing Summary

Essential Utilities describes progress on integration planning for its proposed merger with American Water. Role selection and organizational design have now been completed for the Executive Leadership Team, their direct reports and the next level of employees, including functions such as Legal and Communications & External Affairs.

The company states that approximately 78% of the workforce already has identified roles in the future merged company, with remaining organizational design decisions expected to be finalized in the fall. All union contracts are being honored, and confirmed roles are being communicated by managers, but changes will not take effect until closing.

The merger is still expected to close by the end of the first quarter of 2027. The communication includes extensive cautionary language about forward-looking statements, outlining numerous regulatory, operational, financial and integration risks that could cause actual outcomes to differ from current expectations.

Key Figures

Workforce with identified roles: 78% of workforce Expected merger closing: End of the first quarter of 2027 American Water Form 10-K filing date: February 18, 2026 +2 more

5 metrics

Workforce with identified roles 78% of workforce Employees with identified roles in the future merged company

Expected merger closing End of the first quarter of 2027 Target timing for closing of the merger with American Water

American Water Form 10-K filing date February 18, 2026 Filing date for American Water’s 2025 Form 10-K with the SEC

Essential Utilities Form 10-K filing date February 26, 2026 Filing date for Essential Utilities’ 2025 Form 10-K with the SEC

Form S-4 registration number 333-292182 Registration statement on Form S-4 for the proposed merger

Key Terms

forward-looking statements, definitive merger agreement, registration statement on Form S-4, joint proxy statement/prospectus, +2 more

6 terms

forward-looking statements regulatory

"Certain statements included in this communication are forward-looking statements"

Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.

definitive merger agreement regulatory

"the parties’ ability to consummate the proposed merger pursuant to the terms of the definitive merger agreement"

A definitive merger agreement is the final, signed contract that sets the exact terms for two companies to combine, including the price, payment method, conditions to closing, and what happens if the deal falls apart. For investors it matters because it turns a tentative plan into a legally binding arrangement—like signing a mortgage rather than agreeing to look at a house—so it often has an immediate effect on share prices and clarifies the risks from regulatory approval, financing or breakup fees.

registration statement on Form S-4 regulatory

"American Water’s registration statement on Form S-4 (Registration No. 333-292182)"

A registration statement on Form S-4 is a formal filing with the U.S. Securities and Exchange Commission used when a company issues shares or other securities as part of a merger, acquisition, exchange offer or similar corporate deal. It bundles the transaction terms, financial statements, risk factors and shareholder vote materials so investors can assess the deal; think of it as a detailed prospectus or buyer’s packet that explains what you would own and how the deal could change your stake.

joint proxy statement/prospectus regulatory

"in the definitive joint proxy statement/prospectus, as filed with the SEC on December 31, 2025"

A joint proxy statement/prospectus is a single, combined document that both asks shareholders to vote on a proposed transaction and provides the detailed information required when new securities are being offered. Think of it as a combined ballot and product brochure that explains the deal, the companies’ finances, key risks and how ownership will change. Investors rely on it to understand the terms, evaluate risks and make informed voting and investment decisions.

infrastructure surcharges financial

"filings for infrastructure surcharges and other governmental agency authorizations"

Infrastructure surcharges are extra fees added to customer bills to recover the cost of building, maintaining or upgrading physical networks and facilities—think of an added line on a utility or shipping bill intended to pay for roads, pipes, power lines or data networks. For investors they matter because these charges can boost short-term revenue and margins but also signal cost pressures, customer resistance or regulatory risk that can affect long-term growth and pricing power.

regulatory lag regulatory

"filings to address regulatory lag; the combined company’s ability to execute"

Regulatory lag is the delay between when government or oversight bodies create, change, or enforce rules and when those rules actually take effect or when firms receive required approvals. For investors it matters because those delays can postpone revenue, increase costs, or extend uncertainty around a project or business plan — like sitting at a traffic light that won’t change, you can’t move forward or adjust your timing until the signal does.

FAQ

What integration milestone did Essential Utilities (WTRG) report in this Form 425?

Essential Utilities reported completing role selection and organizational design for leadership and the next level of employees, with about 78% of its workforce now having identified roles in the planned merged company with American Water. Remaining functions are expected to be finalized in the fall.

What percentage of Essential Utilities (WTRG) employees have roles in the future merged company?

The company states that approximately 78% of its workforce already has identified roles in the future merged company with American Water. This reflects completion of role selection for key leadership and several functions, with the balance targeted for completion later.

When does Essential Utilities (WTRG) expect its merger with American Water to close?

Essential Utilities continues to expect the merger with American Water to close by the end of the first quarter of 2027. The company notes that organizational changes being communicated now will not become effective until that merger closing occurs.

How is Essential Utilities (WTRG) handling union contracts in the American Water merger?

Essential Utilities reiterates that all union contracts are being honored as part of the integration planning for the proposed merger with American Water. This commitment applies while organizational design and role selections are completed for the future combined company.

How are Essential Utilities (WTRG) employees being notified of future roles post-merger?

Employees whose future-state roles have been confirmed are notified directly by their managers. These discussions are happening well ahead of the expected merger closing to provide clarity, although the new roles and organizational changes only take effect once the merger is completed.

What risks and uncertainties around the Essential Utilities (WTRG) and American Water merger are highlighted?

The communication includes a detailed forward-looking statements section outlining risks such as regulatory approvals, potential termination of the merger agreement, integration challenges, failure to realize synergies, litigation, macroeconomic conditions, environmental and tax law changes, and other factors that could affect completion and outcomes.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Available on EDGAR 08/14/2026 - 04:45 PM Accepted by SEC EDGAR 08/14/2026 - 04:40 PM Learn about SEC filing dates

Filed by Essential Utilities, Inc.

pursuant to Rule 425 under the Securities Act of 1933

and deemed filed pursuant to Rule 14a-6(b)

under the Securities Exchange Act of 1934

Subject Company: Essential Utilities, Inc.

Commission File No.: 001-06659

Date: August 14, 2026

TO: All Essential Employees

FROM: Chris Franklin

SUBJECT: Integration Update: Progress made on future organizational structure

Dear Colleagues,

As part of our integration planning efforts with American Water, we have reached another important milestone in shaping the organizational design for the future combined company.

Following the completion of work on our Executive Leadership Team and their direct reports, we have now addressed role selections for the next level of employees and related organizational design decisions, continuing our careful and intentional approach. For certain functions, such as Legal and Communications & External Affairs, role selection for the group has been completed and is being communicated. With the completion of this phase, approximately 78% percent of our workforce have identified roles in the future merged company. For all remaining functions/groups, we expect to finalize organizational design and role selections in the fall. As previously communicated, all union contracts are being honored.

Individuals whose future-state roles have been confirmed at this stage of the organizational design process are being notified directly by their managers. These conversations are taking place now, well in advance of our planned closing, to provide timely clarity and support in planning for a successful integration. However, these changes are not effective until the merger closes, which is still expected to be by the end of the first quarter of 2027.

For those who have been involved in our integration planning, thank you for your contributions to this important work alongside your day-to-day responsibilities. We have made great progress. As always, please stay safe.

Best, 

Chris  

Cautionary Statement Regarding Forward-Looking Statements   

Certain statements included in this communication are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by words with prospective meanings such as “intend,” “plan,” “estimate,” “believe,” “anticipate,” “expect,” “predict,” “project,” “propose,” “assume,” “forecast,” “outlook,” “future,” “likely,” “pending,” “goal,” “objective,” “potential,” “continue,” “seek to,” “may,” “can,” “will,” “should” and “could,” or the negative of such terms or other variations or similar expressions. Forward-looking statements may relate to, among other things: statements about the benefits of the proposed merger, including future financial and operating results; the parties’ respective plans, objectives, expectations and intentions; the expected timing and likelihood of completion of the merger and related transactions; the results of any strategic review; expected synergies of the proposed merger; the timing and result of various regulatory proceedings related to the proposed merger, and other general rate cases, filings for infrastructure surcharges and other governmental agency authorizations and proceedings, and filings to address regulatory lag; the combined company’s ability to execute its current and long-term business, operational, capital expenditures and growth plans and strategies; the amount, allocation and timing of projected capital expenditures and related funding requirements; the future impacts of increased or increasing transaction and financing costs associated with the proposed merger or otherwise, as well as inflation and interest rates; each party’s ability to finance current and projected operations, capital expenditure needs and growth initiatives by accessing the debt and equity capital markets and sources of short-term liquidity; impacts of the proposed merger on the future settlement or settlements of a party’s forward sale agreements, including potential adjustments to the forward sale price or other economic terms thereunder, and the amount of and the intended use of net proceeds from any such future settlement or settlements; the outcome and impact on other governmental and regulatory investigations; the filing of class action lawsuits and other litigation and legal proceedings related to the proposed merger; the ability to complete, and the timing and efficacy of, the design, development, implementation and improvement of technology and other strategic initiatives; each party’s ability to comply with new and changing environmental regulations; regulatory, legislative, tax policy or legal developments; and impacts that future significant tax legislation may have on each such party and on its business, results of operations, cash flows and liquidity. 

These forward-looking statements are predictions based on currently available information, the parties’ current respective expectations and assumptions regarding future events that American Water Works Company, Inc. (“American Water”) and Essential Utilities, Inc. (“Essential Utilities”) believe to be reasonable. They are not, however, guarantees or assurances of any outcomes, performance or achievements, and readers are cautioned not to place undue reliance upon them. You should not regard any forward-looking statement as a representation or warranty by American Water, Essential Utilities or any other person that the expectation, plan or objective expressed in such forward-looking statement will be successfully achieved in any specified time frame, or at all. The forward-looking statements are subject to a number of estimates and assumptions, and known and unknown risks, uncertainties and other factors. Actual results may differ materially from those discussed in the forward-looking statements included in this communication as a result of the factors discussed in American Water’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission (the “SEC”) on February 18, 2026 (available at: ir.amwater.com), Essential Utilities’ Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC on February 26, 2026 (available at: essential.co), and each party’s other filings with the SEC, and additional risks and uncertainties, including with respect to (1) the parties’ ability to consummate the proposed merger pursuant to the terms of the definitive merger agreement or at all; (2) each party’s requirement to obtain required governmental and regulatory approvals required for the proposed merger (and/or that such approvals may result in the imposition of burdensome or commercially undesirable conditions, including required dispositions, that could adversely affect the combined company or the expected benefits of the proposed merger); (3) an event, change or other circumstance that could give rise to the termination of the merger agreement; (4) the failure to satisfy or waive a condition to closing of the proposed merger on a timely basis or at all; (5) a delay in the timing to consummate the proposed merger; (6) the failure to integrate the parties’ businesses successfully; (7) the failure to fully realize benefits, efficiencies and cost savings from the proposed merger or that such benefits, efficiencies and cost savings may take longer to realize or be more costly to achieve than expected; (8) negative or adverse impacts of the announcement of the proposed merger on the market price of American Water’s or Essential Utilities’ common stock; (9) the risk of litigation, legal proceedings or other challenges related to the proposed merger; (10) disruption from the proposed merger making it more difficult to maintain relationships with customers, employees, contractors, suppliers, regulators, vendors, elected officials, governmental agencies, or other stakeholders; (11) the diversion of each party’s management’s time and attention from ongoing business operations and opportunities of such party on merger-related matters; (12) the challenging macroeconomic environment, including disruptions in the water and wastewater utility industries; (13) the ability of each party to manage its respective existing operations and financing arrangements on favorable terms or at all, including with respect to future capital expenditures and investments, operations, and maintenance costs; (14) changes in environmental laws and regulations regarding each party’s respective operations that may adversely impact such party’s businesses or increase the cost of operations; (15) changes in each party’s key management and personnel; (16) changes in tax laws that could adversely affect beneficial tax treatment of the proposed merger; (17) regulatory, legislative, local or municipal actions affecting the water and wastewater industries, which could adversely affect the parties’ respective utility subsidiaries; and (18) other economic, business and other factors, including inflation, interest rate fluctuations or tariffs. The foregoing factors should not be construed as exhaustive. 

These forward-looking statements are qualified by, and should be read together with, the risks and uncertainties set forth above and the risk factors included in American Water’s and Essential Utilities’ respective annual and quarterly reports as filed with the SEC and in the definitive joint proxy statement/prospectus, as filed with the SEC on December 31, 2025 (available at: https://www.sec.gov/Archives/edgar/data/1410636/000119312525337598/d15683d424b3.htm), and readers should refer to such risks, uncertainties and risk factors in evaluating such forward-looking statements. Any forward-looking statements speak only as of the date this communication is first used or given. Neither American Water nor Essential Utilities has any obligation or intention to update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as otherwise required by the federal securities laws. New factors emerge from time to time, and it is not possible for American Water or Essential Utilities to predict all such factors. Furthermore, it may not be possible to assess the impact of any such factor on American Water’s or Essential Utilities’ businesses, viewed independently or together, or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. 

Proposed Merger 

For additional information regarding the proposed merger, please see American Water’s registration statement on Form S-4 (Registration No. 333-292182), which was declared effective by the SEC on December 30, 2025, and the other documents that American Water or Essential Utilities has filed or may file with the SEC. 

No Offer or Solicitation 

This communication is for informational purposes and is not intended to, and shall not, constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any offer or sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.