This $540-Million Wastewater Deal Could Change The Game For H2O America

H2O America Inc. HTO announced a significant expansion of its Texas operations on Tuesday with a $540 million agreement to acquire the assets of Quadvest, a major water and wastewater utility based in the Houston metropolitan area.

The deal, involving H2O America’s subsidiaries The Texas Water Company and Texas Water Operation Services, is designed to strengthen the company’s presence in one of the fastest-growing regions in the U.S.

With this acquisition, H2O America expects to double its connections in Texas and increase its exposure to high-growth residential and commercial developments in the Houston area.

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Quadvest brings more than 47,000 active utility connections and over 89,000 under contract across 69 developments, including 50 water treatment and 27 wastewater facilities.

H2O America projects that by 2029, Texas will account for roughly 26% of its total customer base—up from just 7% prior to this transaction.

The company views this growth as a springboard for continued capital investment and plans to allocate over $500 million toward Texas infrastructure in the next five years.

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The acquisition is expected to boost H2O America’s long-term earnings per share growth and improve operational diversity. It also increases the company’s total five-year capital spending plan to approximately $2.1 billion.

Financing for the deal will be provided through a mix of private debt and equity infusions, with no new financing conditions required.

The deal, which has received unanimous approval from H2O America’s and TWC’s boards, is expected to close by mid-2026, pending regulatory approvals from the Public Utility Commission of Texas and clearance under the Hart-Scott-Rodino Act.

Price Action: HTO shares are trading higher by 1.99% to $53.39 premarket at last check Tuesday.

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