American Water closes sale of Homeowner Services Group

American Water Works on Friday said it completed the previously announced sale of its Homeowner Services Group for $1.275 billion to funds advised by Apax Partners LLP.

Under the agreement, American Water received $485 million in cash, inclusive of $5 million for a working capital adjustment, and a $720 million secured Seller Note bearing a 7% annual interest rate with a five-year term.

The deal also includes a delayed payment to American Water of $75 million, if certain milestones are met by Dec. 31, 2023.

American Water was exclusively advised by BofA Securities, Schulte Roth & Zabel LLP and Shearman & Sterling LLP.