UPDATE 1-Nashua city to buy water supplier Pennichuck, shrs up

* Deal valued at $138 mln

* Offer of $29/shr at a 19-pct premium

* Shares up as much as 16 pct

Nov 12 (BestGrowthStock) – Potable water supplier Pennichuck Corp
(PNNW.O: ) agreed to be bought by the city of Nashua for about
$138 million in cash, ending a protracted dispute with the New
Hampshire city, sending the company’s shares to a nearly
three-year high.

The city of Nashua will buy the company’s shares at $29
each, a 19 percent premium to Pennichuck’s Thursday close.

The city has been trying to take over Pennichuck citing
eminent domain law under which governments can seize private
property for public purpose after paying compensation.

“The company and the city intend that this transaction be
in full settlement of their eminent domain dispute and the
related proceeding currently before the New Hampshire Public
Utilities Commission …” Pennichuck said in a statement.

The deal, which values Pennichuck at $200 million including
debt, is expected to be financed through the issuance of
general obligation bonds.

Pennichuck, which has a market value of about $113.8
million, said Boenning & Scattergood and others were advising
it on the deal.

Shares of the Merrimack, New Hampshire-based company were
up 13 percent in morning trade, after closing at $24.4 on
Thursday on Nasdaq. They jumped 16 percent to reach $28.39
earlier in the session.
(Reporting by Vaishnavi Bala in Bangalore; Editing by Roshni
Menon)

UPDATE 1-Nashua city to buy water supplier Pennichuck, shrs up