Eversource Energy Discloses Proposal to Acquire Connecticut Water Service, Inc. for $63.50 Per Share

Acquisition would combine two local Connecticut businesses with
highly complementary footprints in the Northeast

Proposal represents superior alternative to generate value for
shareholders, employees, customers, and local communities

HARTFORD, Conn.–(BUSINESS WIRE)–Eversource Energy (NYSE: ES) today announced that on April 5, 2018 it
made a proposal to acquire all the outstanding shares of Connecticut
Water Service, Inc. (Nasdaq: CTWS) for $63.50 per share in cash and/or
in Eversource common shares at the election of Connecticut Water
shareholders.

Eversource believes its proposal is a superior alternative to the
all-stock transaction proposed in SJW Group’s (NYSE: SJW) agreement
announced March 15, 2018 to acquire Connecticut Water. Eversource’s
proposal represents a 21% premium to Connecticut Water’s closing share
price on March 14, 2018, the day prior to the SJW announcement.
Eversource’s proposal also represents a premium of 22% to Connecticut
Water’s 20-day volume-weighted average price as of March 14, 2018. In
addition, those Connecticut Water shareholders who elect to receive
Eversource shares would realize the equivalent of an 81% dividend uplift
based on the closing price of Eversource’s shares on April 4, 2018 and
the annualized quarterly dividend of $0.2975 per share declared by
Connecticut Water on January 18, 2018.

Eversource has attempted to engage privately with Connecticut Water for
some time. The company expressed its interest in pursuing an acquisition
of Connecticut Water in 2017. On April 5, 2018, Eversource verbally
communicated its intent to submit a proposal to David C. Benoit, the
Chief Executive Officer of Connecticut Water, and delivered a written
proposal the same day. On April 17, 2018, Eversource sent a follow-up
communication to Connecticut Water expressing its continued interest in
pursuing an acquisition.

“We believe that our proposal represents a unique opportunity to deliver
significant and immediate value to Connecticut Water’s shareholders,
customers, employees, and local communities,” said Eversource Chairman,
President and Chief Executive Officer Jim Judge. “As such, we were
surprised and disappointed that Connecticut Water’s Board of Directors
has been unwilling to engage in discussions with us. We urge the Board
of Connecticut Water to act in the best interests of its shareholders by
meeting with us to seriously discuss our compelling proposal.”

Eversource has a best-in-class financial profile, including a market
capitalization of approximately $19 billion, a long-track record of
consistent and robust earnings and dividend growth, an industry best S&P
credit rating, and a strong and growing dividend. There would be no
financing contingency as part of the transaction.

The proposed transaction would combine two highly complementary local
businesses, and would enable cost-effective regional investment and
support economic growth. Eversource is the parent company of Aquarion
Water Company, a Connecticut based water utility whose service territory
is in close proximity to Connecticut Water’s service territory. Aquarion
Water serves nearly 230,000 customers in Connecticut, Massachusetts, and
New Hampshire, with approximately 90% located in Connecticut.
Connecticut Water serves approximately 125,000 customers in Connecticut
and Maine with approximately 85% located in Connecticut.

“The proposed transaction would provide Connecticut Water customers with
the benefit of premier service quality and a highly reliable water
supply into the future,” said Aquarion President and Chief Executive
Officer Charles Firlotte. “The combined company would have a
complementary service territory and would allow for an expansion of the
superior customer service our employees proudly provide.”

Eversource has retained Goldman Sachs as its financial advisor and Ropes
& Gray as its legal advisor on this matter.

The full text of Eversource’s April 5, 2018 non-binding proposal to
acquire Connecticut Water appears below:

April 5, 2018

Mr. David C. Benoit
President and Chief Executive Officer
Connecticut
Water Service, Inc.
93 West Main Street
Clinton, CT 06413

Dear David:

On behalf of Eversource Energy (“Eversource”), I am hereby submitting a
proposal to acquire Connecticut Water Service, Inc. (“Connecticut
Water”). As you are likely aware, we expressed interest in pursuing an
acquisition of Connecticut Water in the second half of 2017. At this
time, we are proposing terms for an acquisition that we firmly view as
superior to the terms of the proposed transaction with San Jose Water
(“SJW”), reasonably likely to lead to a Superior CTWS Proposal (as
defined in the merger agreement with SJW) and in the best interest of
the customers, employees, suppliers, local communities and shareholders
of Connecticut Water due to the greater benefits achievable through an
Eversource transaction.

Eversource proposes to acquire all of the outstanding shares of
Connecticut Water common stock for $63.50 per share in cash and/or in
Eversource common stock at the election of Connecticut Water
shareholders. Connecticut Water shareholders electing to receive
Eversource stock as consideration would realize the equivalent of an 81%
dividend uplift based on the closing price of Eversource’s common stock
on April 4, 2018 and the annualized quarterly cash dividend of $0.2975
per share declared by Connecticut Water on January 18, 2018. The $63.50
consideration payable to Connecticut Water shareholders would not be
reduced by the termination fee payable to SJW.

The $63.50 price represents a 21% premium to Connecticut Water’s
undisturbed share price on March 14, 2018 and a 22% premium to the
20-day VWAP for the period ending March 14, 2018.

Eversource has a market capitalization of approximately $19 billion and
is an A+ rated company by Standard & Poor’s, making Eversource a strong
financial partner for the transaction. There would be no financing
contingency as part of the transaction.

Eversource has consistently demonstrated credibility, expertise, and
responsiveness in its proceedings before the Connecticut Public
Utilities Regulatory Authority (“CT PURA”) and has a strong track record
for successful regulatory outcomes. In particular, Eversource has
considerable experience in obtaining regulatory approvals required for
utility mergers and acquisitions. This is evidenced through our recent
acquisition of Aquarion Water Company (“Aquarion”), for which we
obtained regulatory approvals in four states and completed the
transaction within five months from the regulatory filing date and
within six months from the announcement of the transaction.

In the final decision issued by CT PURA approving the Aquarion
acquisition, attributes of the transaction that were cited as
particularly beneficial to customers and employees included local
ownership, financial stability, employee benefits and community support.
In fact, Eversource is uniquely positioned to create substantial
benefits for customers served by Connecticut Water, while preserving
local ownership and accountability. As part of the approvals required to
complete the Aquarion acquisition, Eversource obtained regulatory
approval in Maine with a positive outcome for the company and a minimum
of administrative process.

In summation, Eversource’s acquisition of Connecticut Water would be a
compelling, superior alternative to the SJW transaction for Connecticut
Water’s customers, employees, suppliers, communities and shareholders.
An Eversource transaction would also leverage the geographical proximity
of the Connecticut Water and Aquarion systems to enable cost-effective
infrastructure investment and support regional economic growth.

I have reviewed this opportunity with Eversource’s Board of Trustees,
which supports the submission of this proposal. We are prepared to
engage with you immediately and to reach a definitive agreement as
expeditiously as possible. For the avoidance of doubt, this proposal is
a non-binding indication of interest, subject to confirmatory due
diligence. A binding obligation with respect to this transaction will
result only from the execution of a definitive agreement containing
terms and conditions that are mutually acceptable to the parties.

We look forward to your prompt response.

Sincerely,

James J. Judge
Chairman, President and Chief Executive Officer
Eversource
Energy

About Eversource:
Eversource (NYSE: ES) transmits and
delivers electricity and natural gas and supplies water to approximately
4 million customers in Connecticut, Massachusetts and New Hampshire.
Recognized as the top U.S. utility for its energy efficiency programs by
the sustainability advocacy organization Ceres, Eversource harnesses the
commitment of about 8,000 employees across three states to build a
single, united company around the mission of safely delivering reliable
energy and water with superior customer service. For more information,
please visit our website (www.eversource.com)
and follow us on Twitter (@EversourceCorp)
and Facebook (facebook.com/EversourceEnergy).
For more information on our water services, visit www.aquarionwater.com.

Forward Looking Statement:
This news release includes
statements concerning Eversource Energy’s expectations, beliefs, plans,
objectives, goals, strategies, assumptions of future events, future
financial performance or growth and other statements that are not
historical facts. These statements are “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of
1995. In some cases, readers can identify these forward-looking
statements through the use of words or phrases such as “estimate,”
“expect,” “anticipate,” “intend,” “plan,” “project,” “believe,”
“forecast,” “should,” “could” and other similar expressions.
Forward-looking statements are based on current expectations, estimates,
assumptions or projections and are not guarantees of future performance.
These expectations, estimates, assumptions or projections may vary
materially from actual results. Accordingly, any such statements are
qualified in their entirety by reference to, and are accompanied by
important factors that could cause our actual results to differ
materially from those contained in our forward-looking statements,
including, but not limited to, in the case of Eversource’s proposal to
acquire Connecticut Water, the failure to complete the subject
transaction upon the terms set forth in Eversource’s proposal;
cyber-attacks or breaches, including those resulting in the compromise
of the confidentiality of our proprietary information and the personal
information of our customers; acts of war or terrorism or grid
disturbances that may disrupt our transmission and distribution systems;
ability or inability to commence and complete our major strategic
development projects and opportunities; actions or inactions of local,
state and federal regulatory, public policy and taxing bodies;
substandard performance of suppliers; climate change; disruption to our
transmission and distribution systems; new technology and conservation
of energy; contamination or failure of our water supplies; unauthorized
access to confidential and proprietary information; changes in laws,
regulations or regulatory policy; changes in economic conditions,
including impact on interest rates, tax policies, and customer demand
and payment ability; changes in business conditions, which could include
disruptive technology related to our current or future business model;
changes in weather patterns, including extreme weather and other effects
of climate change; reputational risk; changes in levels or timing of
capital expenditures; technological developments and alternative energy
sources; disruptions in the capital markets or other events that make
Eversource Energy’s access to necessary capital more difficult or
costly; developments in legal or public policy doctrines; changes in
accounting standards and financial reporting regulations; actions of
rating agencies; and other presently unknown or unforeseen factors.

Other risk factors are detailed in Eversource’s reports filed with the
Securities and Exchange Commission (SEC) and updated as necessary, and
are available on the SEC’s website at www.sec.gov.
All such factors are difficult to predict and contain uncertainties that
may materially affect Eversource Energy’s actual results many of which
are beyond our control. You should not place undue reliance on the
forward-looking statements; each speaks only as of the date on which
such statement is made, and, except as required by federal securities
laws, Eversource Energy undertakes no obligation to update any
forward-looking statement or statements to reflect events or
circumstances after the date on which such statement is made or to
reflect the occurrence of unanticipated events.

Contacts

Eversource
Media Contacts:
Caroline Pretyman,
617-424-2460
[email protected]
or
Investor
Contacts:
Jeffrey R. Kotkin, 860-665-5154
[email protected]
or
Brunswick
Group
Jonathan Doorley, 917-231-6201
or
Darren McDermott,
917-345-3621