Pennichuck: anti-takeover costs mounting
Pennichuck Corporation’s annual costs to fend off a takeover attempt by the city of Nashua is multiplying — literally.
This year, the company expects to spend $2.3 million to $2.4 million in legal, consulting and other costs to fight Nashua’s bid, according to a filing Monday with the Securities and Exchange Commission. That’s nearly double the $1.4 million it spent last year, which was double the $721,000 spent in 2004.
Already, the company disclosed last week, it has spent $1 million in the first quarter alone in fighting the takeover, which the company chiefly blamed for its $707,000 loss. That loss compared to a $460,000 loss in the first quarter of 2005.
In its Monday filing, the company said that some of the costs were due to a “significant public information campaign opposing the city’s efforts.” The company did not detail what the ad and PR campaign cost.
Interim CEO Hannah McCarthy said that none of the costs were passed on to the ratepayers.
A takeover would have a significant impact on the company’s business, said the filing, especially since Nashua is negotiating with another vendor to manage the system if it wins its takeover attempt. It is talking with Veolia Water North America-Northeast LLC. Veolia is a wholly owned subsidiary of Veolia Environment, (which formerly was known as Vivendi Environnement). – BOB SANDERS