Eversource shares slump after Connecticut regulator blocks $2.4 billion Aquarion sale (updated)

Eversource Energy

19/11/2025 19:18

Adds analyst comment in paragraph 6 and 7

Nov 19 (Reuters) - Eversource Energy ES.N shares fell over 10% on Wednesday after Connecticut regulators rejected the company's proposal to sell its water utility business, dealing a setback to the utility's efforts to streamline operations and reduce debt.

Eversource agreed in January to sell Aquarion in a deal valued at $2.4 billion, after acquiring the water utility in 2017 for about $1.7 billion.

The regulator concluded that the deal fails managerial suitability and responsibility requirements "in a manner consistent with the public interest", despite meeting financial and technological criteria, along with likely ensuring continued safe and reliable service to customers.

Eversource responded that the state was interested in expanding a non-profit model. However, when this was tested, Connecticut Public Utilities Regulatory Authority (PURA) found it challenging to transition from the investor-owned model.

The 2024 special act directed the state to explore if a non-profit ownership model could better serve water customers.

Citi analyst Ryan Levine said, "Given this decision, the company's cash flow and balance sheet improvement path remains challenging."

He added that the new PURA is not as constructive as the market hoped.

The application for the transfer of control of Aquarion was filed by Eversource, Aquarion Water Authority (AWA) and the South Central Connecticut Regional Water Authority (RWA).

Aquarion provides public water supply and distribution services to nearly 226,000 customers in 73 cities and towns across Connecticut, Massachusetts and New Hampshire.

The deal was expected to close in late 2025.

 (Reporting by Sumit Saha in Bengaluru; Editing by Vijay Kishore)

 ((Sumit.Saha@thomsonreuters.com))