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  • Staff file phot

    Barbara Pressly is shown during a special shareholders meeting Wednesday, June 15, 2011, at the Pennichuck Corporation headquarters in Merrimack. Pressly's legislation to keep members of the Board of Assessors from serving on other boards failed Aug. 26, 2013.
  • Staff photo by Bob Hammerstrom


    Company comptroller Larry Goodhue, right, reads the vote tally for the sale of the utility during a special shareholders meeting Wednesday, June 15, 2011, at the Pennichuck Corporation headquarters in Merrimack.
  • Staff photo by Bob Hammerstrom


    Shareholders listen to Pennichuck President and CEO, Duane Montopoli, above, during a special shareholders meeting Wednesday, June 15, 2011, at the Pennichuck Corporation headquarters in Merrimack.
  • Staff photo by Bob Hammerstrom


    Shareholder Madeleine Rousseau discusses her vote following a special shareholders meeting Wednesday, June 15, 2011, at the Pennichuck Corporation headquarters in Merrimack.
  • Staff photo by Bob Hammerstrom


    Company President and CEO Duane Montopoli answers questions from shareholders during a special meeting and vote Wednesday, June 15, 2011, at the Pennichuck Corporation headquarters in Merrimack.
Thursday, June 16, 2011

Pennichuck shareholders approve sale to Nashua

MERRIMACK – Pennichuck shareholders approved a deal Wednesday morning to sell the company’s stock to the city of Nashua for $29 a share.

The approval is the second step in a three-step process required for the city to acquire Pennichuck Corp. via a stock purchase.

In the first step, Nashua aldermen approved the deal earlier this year.

The final step is for the state Public Utilities Commission to give its blessing to the acquisition.

The result of the shareholders’ vote was announced at a meeting of the Pennichuck directors at the company’s headquarters at 25 Manchester St. in Merrimack.

Individuals controlling 3,370,904 shares of stock voted to approve the deal. The total represented 72 percent of the total 4,681,427 shares.

A two-thirds vote was required for the deal to be approved.

Only one shareholder voted at the meeting. The other voters cast ballots earlier, themselves or by proxy.

Duane Montopoli, the company’s president and chief executive officer, said he wasn’t surprised by the vote.

“It’s never easy to get two-thirds of anything,” Montopoli said. “That’s a big nut. But from the onset, we were confident we would get a two-thirds majority.”

The $200 million deal was struck in November after a lengthy closed-door negotiation between Pennichuck and Nashua officials. The deal also ended the city’s eminent domain proceedings against Pennichuck Water Works, a company subsidiary that provides the public water system for the city.

Nashua’s latest efforts to acquire the 159-year-old company began nearly a decade ago when Pennichuck almost was sold to a Dutch company.

City officials feared Nashua would lose control of its local water supply and watershed, and two mayoral administrations and several boards of aldermen over the ensuing years fought to either acquire Pennichuck Water Works through eminent domain or negotiate a deal to buy the entire company.

Montopoli estimated that the state PUC will consider the issue in the fourth quarter of the year, though he added the disclaimer that PUC approval is out of the hands of the company.

“It’s a joyous day,” exclaimed Barbara Pressly, a city alderman and longtime advocate of the city acquiring the water utility.

Pressly owned a single share of Pennichuck stock for years but surrendered the stock to her son when she was elected to the Board of Aldermen in 2009.

She voted for her brother by proxy, casting a ballot to approve the deal. It was the first time she voted in a Pennichuck election, Pressly said.

Not all shareholders at the meeting shared Pressly’s enthusiasm for the deal.

Madeleine Rousseau, 83, said she is very much against it for personal financial reasons and because she doubts Nashua’s ability to manage the company.

Rousseau’s late husband worked for Pennichuck Water Works for 38 years, and his father also was a Pennichuck employee. Her son, Bernard Rousseau, is vice president for sales and service of Pennichuck Water Service Co., a subsidiary.

Madeleine Rousseau said she was unhappy the company sold the stock for $29 a share before taxes, a deal that is likely to cost her $7,000 or more in capital gains taxes, she said. A private company might have bought the company for the same price per share after taxes, she said.

More than that, Rousseau said she worries Nashua city officials don’t realize the cost of buying and repairing equipment and other responsibilities involved in running the company.

“They don’t understand the procedure at all, nobody in the city,” Madeleine Rousseau said.

Richard E. Allard of Nashua bought shares of Pennichuck stock 25 years ago, and he’s glad he did.

He was living in Hudson at that time, and he saw that Pennichuck then was selling water at less than half the cost that a company running Hudson’s water system charged, Allard said.

The worth of the stock could only go up, Allard reasoned.

Allard said he owned “a couple hundred shares” of stock.

He said he was impressed with how Pennichuck officials treated him even though he was just an average Joe shareholder.

“They treated me like I was part of the family,” Allard said.

He also has doubts about how the company will fare under Nashua’s management.

Several shareholders at the meeting asked about when they would receive money when the stock is transferred. Other questions addressed dividend payments – which will continue until the deal is closed – and tax liability.

Attorney Michael Krebs, the federal Securities and Exchange Commission counsel for Pennichuck, said share certificates would be sent to the city after the deal closes. The city will send shareholders a letter then, outlining the procedure, Krebs said.

“It would be a good time this summer to go through your closets and look for your certificates,” Krebs said.

The city’s letter will advise shareholders on what to do if they can’t find their stock certificates, he said.

Patrick Meighan can be reached at 594-6518 or pmeighan@nashuatelegraph.com.