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  • Courtesy photo Pipe delivery, 1900, Pennichuck Water Works, Nashua.
  • Staff photo by Don Himsel John Boisvert, chief engineer for Pennichuck Water Works, stands among giant pipes that send treated water from the Nashua facility to its distribution system.
  • Staff photo by Don Himsel

    The light blue motors operate pumps and move what's referred to as intermediate water through Pennichuck's system. The dark blue motors operate pumps that move water out of the building into the delivery system.
Sunday, November 14, 2010

Pennichuck time line: Path to acquisition starts in 2002

This is a time line of the city of Nashua’s effort to acquire Pennichuck Water Works:

APRIL 2002: Pennichuck Corp. announces it will be acquired by Philadelphia Suburban Corp. for about $106 million in a stock-for-stock transaction. The idea of an out-of-state firm owning the water system of the city and surrounding communities draws a groundswell of critics.

JUNE 2002: The Board of Aldermen approves $100,000 for an in-depth, independent study of ramifications of the sale.

AUGUST 2002: Community activist Barbara Pressly begins to pull together a committee whose goal would be to establish a regional water authority that would acquire Pennichuck Corp.

NOVEMBER 2002: The city-funded study questions Pennichuck’s handling of the community’s drinking water, and Mayor Bernie Streeter says the city should acquire the water utility, which would eventually be owned by a proposed regional water district. Aldermen vote 14-1 to put the question of the city acquiring Pennichuck to voters in a special election scheduled for Jan. 14, 2003. Bedford becomes the first town to vote to become a member of the proposed water district.

JANUARY 2003: By a count of 6,525-1,867, Nashua voters give the city the go-ahead to pursue buying the water company. A bill that would allow a regional water district to be created is introduced in the state Legislature.

FEBRUARY 2003: Pennichuck and Philadelphia Suburban call off their merger by mutual agreement. The companies say the citywide referendum vote is the deciding factor in their move.

JUNE 2003: The Legislature approves enabling Nashua and surrounding towns to form a regional water district.

AUGUST 2003: Don Correll, a 25-year water-industry veteran, becomes Pennichuck Corp.’s president and chief executive officer. He replaces longtime CEO Maurice Arel.

NOVEMBER 2003: City officials announce they have an offer on the table of $121 million, which they say is equal to the Philadelphia Suburban deal because it includes $15 million to cover the company’s tax liabilities.

DECEMBER 2003: Pennichuck’s board of directors unanimously votes to reject the city’s buyout offer.

FEBRUARY 2004: Pennichuck files a lawsuit in Hillsborough County Superior Court seeking to “end the limbo” between the company and City Hall. The suit asks the court to give a time frame for when Nashua should file for eminent domain proceedings with the state Public Utilities Commission.

MARCH 2004: Fourteen months after residents gave the go-ahead, city officials submit a petition to the PUC to take over Pennichuck’s regulated water systems.

APRIL 2004: Pennichuck sues the city for more than $5 million in Hillsborough County Superior Court, charging City Hall abused its power and deprived the company of its civil rights to conduct business freely. After two years of debate, a regional committee approves a final version of a charter to establish a regional water district.

JULY 2004: The PUC opens a hearing on Nashua’s proposed takeover of Pennichuck.

SEPTEMBER 2004: Hillsborough County Superior Court Judge Robert Lynn dismisses Pennichuck’s challenge to the constitutionality of the eminent domain law, and rules that the PUC is the proper forum to decide the case.

DECEMBER 2004: Lynn rules against Pennichuck in its suit seeking financial damages from the city, reiterating that the issues raised by the company should be handled in front of the PUC. Less than a week later, the PUC rules that the city can’t acquire Pennichuck Corp. subsidiaries that are outside city borders. That leaves Pennichuck Water Works on the table, but prevents the city from pursuing the property of Pennichuck East Utility and Pittsfield Aqueduct Co.

SEPTEMBER 2005: Lawyers for Pennichuck and the city present oral arguments before the state Supreme Court on the constitutionality of the state law that would allow the city to seize the utility.

NOVEMBER 2005: Three of the four candidates who oppose the Pennichuck takeover are elected to the Nashua Board of Aldermen after the company mounts an aggressive ad campaign to support them. A week later, the Supreme Court sides with Nashua and upholds the constitutionality of the eminent domain law.

MARCH 2006: Correll, Pennichuck Corp. president and chief executive officer, announces he is leaving to take a similar job in New Jersey at American Water. Hannah McCarthy, Pennichuck board member, is announced as interim CEO.

APRIL 2006: The staff of the PUC issues a 70-page report saying it wasn’t in the public’s interest for the city of Nashua to take over Pennichuck Water Works. City officials remain undeterred in their takeover attempts.

AUGUST 2006: Duane Montopoli is named president and CEO of Pennichuck Corp., replacing Correll. Montopoli remains confident the city will fail in its takeover attempts.

NOVEMBER 2006: City officials decide to send their lawyers to a settlement negotiation at the PUC with a new offer to take over Pennichuck. The decision is made after three hours of non-public discussion. Pennichuck officials remained skeptical that any offer by the city would ever lead to a successful takeover.

JANUARY 2007: After starting hearings at the PUC the previous week, the commission suspends hearings Jan. 16 for 120 days at the request of both sides so they could try to negotiate a sales-purchase agreement.

JULY 16, 2007: The city announces it was unable to come to a settlement with the water utility and has terminated talks, sending the case back to the PUC.

JULY 25, 2008: In a 120-page decision, the PUC rules in favor of Nashua and fixes the price at $203 million, plus a $40 million fee for damage to Pennichuck Corp.’s other subsidiaries.

AUGUST 2008: Pennichuck and the city both appeal the decision. Pennichuck wants the PUC to reverse it entirely, while Nashua claims the purchase price is too high.

OCTOBER 2008: Pennichuck shareholders begin pushing for a stock sale as a resolution to eminent domain, and the city seems warm to the idea.

MARCH 2009: Both appeals are denied. The city and Pennichuck announce they will pursue the case in New Hampshire Supreme Court.

MAY 2009: Billionaire investor Mario Gabelli, Pennichuck’s largest stockholder, issues a report saying the city is the party delaying an out-of-court settlement. He floats a sale price of $31 per share. Pennichuck uses that price at its annual shareholder meeting to discuss the benefits of a private sale. Nashua still seems warm to the idea, but says $31 per share was too high.

DEC. 8, 2009: The city announces that an investment banking firm it hired determined Pennichuck Corp.’s fair market value to be $25 per share, not the $31 Pennichuck has floated. The city says it would go back to pursuing a takeover by eminent domain via the case pending in state Supreme Court.

JAN. 21, 2010: Both sides argue their cases before the New Hampshire Supreme Court.

MARCH 25, 2010: The Supreme Court upholds the PUC’s 2008 ruling, leaving the city with 90 days to decide whether to take the utility by eminent domain for $243 million. The city begins meeting with attorneys and consultants to discuss its options. Shortly after, closed-door settlement talks resume between the city and Pennichuck.

JUNE 2010: The city files for an extension with the PUC, and Pennichuck consents. Closed-door settlement talks continue.

SEPT. 30, 2010: The extension expires without any action from the city.