American Water Announces Exercise of Over-Allotment Option

American Water Works Company, Inc. (NYSE: AWK), the largest investor-owned U.S. water and wastewater utility company, today announced that the underwriters of the public offering of American Water common stock have exercised their over-allotment option and purchased 5.25 million additional shares of common stock from the selling stockholder in the offering, a subsidiary of RWE AG.

American Water announced an offering of 35 million shares of common stock priced at $19.25 per share on August 13, 2009. All the shares were sold by RWE, with all proceeds going to RWE. American Water did not sell any shares and as such, the number of American Water shares outstanding following the offering remains the same. American Water also did not receive any proceeds from the sale. RWE now owns approximately 23.54 percent of American Water’s outstanding shares of common stock.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

An effective registration statement relating to these securities is on file with the U.S. Securities and Exchange Commission. A copy of the final prospectus and prospectus supplement may be obtained by contacting any of the following:

• BofA Merrill Lynch, Attention: Prospectus Department, One Bryant Park, New York, NY 10036, telephone +1 212 449 1000.
• Citi, Brooklyn Army Terminal, 140 58th Street, 8th Floor, Brooklyn, NY 11220, telephone +1 718 765 6732.
• Goldman, Sachs & Co., Attention: Prospectus Department, 85 Broad Street, New York, NY 10004, facsimile +1 212 902 9316, e-mail prospectus-ny@ny.email.gs.com.

You may also obtain the final prospectus and prospectus supplement on the U.S. Securities and Exchange Commission's website at http://www.sec.gov.

About American Water

Founded in 1886, American Water is the largest investor-owned U.S. water and wastewater utility company. With headquarters in Voorhees, N.J., the company employs more than 7,000 dedicated professionals who provide drinking water, wastewater and other related services to approximately 15 million people in 32 states and Ontario, Canada. www.amwater.com