The core business of AMERICAN WATER WORKS COMPANY, INC. is the ownership of common stock of utility companies providing water service. The combination of American Water Works with its subsidiaries constitutes the American Water System - a system that has functioned for over 50 years. Each subsidiary functions independently, yet shares in the benefits of size and identity afforded by the American Water System.

The Company’s subsidiaries provide water and/or wastewater service to customers in 22 states. As public utilities, each company is subject to the rules of both federal and state environmental protection agencies, particularly with respect to the quality of the water they distribute.

AMERICAN WATER SERVICES (AWS) became a wholly owned subsidiary when the Company acquired its joint venture partner's 50 percent interest in AmericanAnglian Environmental Technologies on December 31, 1999. AWS is focused on the growing contract operations segment of the water and wastewater market. It manages and operates water and wastewater facilities, providing service to customers in seven states, six of which states also have communities served by the Company’s utility subsidiaries.

AMERICAN WATER RESOURCES is a subsidiary formed to invest in water and wastewater related products and services.

AMERICAN WATER WORKS SERVICE COMPANY, a subsidiary, provides professional services as required to affiliated companies. These services include accounting, administration, communication, corporate secretarial, engineering, financial, human resources, information systems, operations, rates and revenue, risk management and water quality. This arrangement, which provides these services at cost, affords affiliated companies professional and technical talent otherwise unavailable economically or on a timely basis.


Consistent with the Company's growth strategy, its management continues to search for opportunities to acquire water and wastewater systems that represent the prospect for enhanced shareholder value.

In this connection, the most significant transaction completed in 1999 was the acquisition of National Enterprises Inc. (NEI), a privately owned holding company with operations primarily in the water utility business. NEI subsidiaries provide water utility service to customers in Illinois, Indiana, Missouri and New York. Since most of NEI's customers are in the mid-west this acquisition significantly furthered the Company's strategy of geographic diversification.