Exhibit 99.2



American Water Works: RWE Acquisition
Financial Analysts Q&A


How is the transaction structured?

American Water's common stock that is outstanding at the date of closing will
be purchased for $46 per share. At June 30, 2001 the Company had 99,256,000
shares outstanding. American Water Works preferred stock will be redeemed and
RWE will assume American Water's outstanding debt at closing. As of June 30,
2001, American Water Works had $2.9 billion in outstanding debt and preferred
stock. That, combined with the value of common equity at $46 per share,
results in an enterprise value for the transaction of $7.5 billion.


Why did American Water agree to this transaction?

Consolidation will define our future, as it has shaped our past. We have built
the largest water company in the United States through a series of
consolidations. These started with the coming together of more than 100 small
water companies in the late 19th and early 20th centuries, and have continued
right up through today, with our pending acquisitions of Azurix North America
and the water and wastewater assets of Citizens Communications.

As Jim Barr noted in the Company's annual report, the fundamental trend in our
industry toward consolidation is unstoppable - in the United States and
internationally. This is because it's essential to access the capital that
ensures our consumers receive reliable service, at the most affordable rates,
now and in the future.

This is particularly important in a business like water services, which
delivers a vital community service that is capital intensive, technologically
demanding, and requires continual investment in a massive, aging and expanding
infrastructure.


How do you believe this deal will change the US regulated water industry?

Consolidation within the water industry is crucial regardless of whether the
assets are owned by municipalities or private investors. American Water Works
was built on that business model. American Water Works knows that regulated
water service provides the best long-term alternative for customers and we
will continue to pursue that business model. Thames Water is experienced in
providing service to a significant number of people through regulated
businesses. Under their guidance, pursuit of business opportunities that
advance industry consolidation will continue. At the same time, American Water
Works' goal of expanding service under non-regulated agreements will be
enhanced.

Continued . . .






Analysts Q&A   page 2



Why did you agree to RWE buy-out offer without putting the company on the
auction block?

American Water Works did not initiate the discussions for the acquisition.
However, once it agreed to begin negotiations, the Company concentrated on
achieving the best possible outcome for its investors, customers and the
associates who built the organization. We believe the transaction we have
announced accomplishes this objective.


How long will it take to complete the transaction?

In addition to shareholder approvals, we anticipate regulatory review in more
than half of the states in which we operate, and estimate at least a year will
be required to complete that process.


What states will need to review this transaction?

At the present time, a final determination is under review.


Do you anticipate difficulties with the approval process in California?

If approval is required in the state of California, we are confident the
Public Utility Commission will recognize the benefit to ratepayers.


Is there a termination date in the agreement?

The agreement allows for termination after 18 months, unless the only
remaining conditions are receipt of regulatory approvals, in which case it
will be extended for an additional 6 months, plus 60 days if necessary to
satisfy waiting periods.


Where can I get a copy of the agreement?

The agreement has been filed with the SEC and is available through EDGAR.


Is there a termination fee in the agreement?

Yes. The agreement calls for a 3% termination fee for both the buyer and
seller under certain very well defined circumstances.


What are the multiples for this transaction?

The per-share price represents a 35% premium above the latest closing share
price of $34.12, and a 29% premium above the all-time high closing price of
$35.60. The enterprise value of $7.5 billion represents a multiple of 12 times
EBITDA, 16.4 times EBIT and 28 times EPS for the year 2000. The equity value,
based upon the per-share offer price and the number of outstanding shares at
June 30, 2001, represents a multiple of 2.7 times above the book value of that
equity on that date.


Continued . . .





Analysts Q&A   page 3


Will there be any impact on earnings between the date of the agreement to the
date of closing?

Transaction costs will be expensed as required by proper accounting and will
impact earnings. However, provisions in the agreement allow American Water
Works to continue paying a dividend and to grow that dividend as much as four
cents per year. Therefore, shareholders will not be harmed by these charges to
earnings. Other provisions in the agreement compensate American Water Works
for these expenses if certain events occur and the transaction is not closed.


Is there likelihood that this transaction will not be completed due to
regulatory complications?

While both companies are extremely committed to completion of this
transaction, it is impossible to predict the outcome of any part of the
approval process, and we will not speculate.


Where can information be found about RWE or Thames?

Both companies have Web sites, and RWE's common stock is publicly traded in
Europe. On the Internet, their sites are www.rwe.com and www.thames-water.com.


Will financial information continue to be available, conference calls
conducted and questions answered by AWK while the merger transaction proceeds?

As long as the common stock of American Water Works remains publicly traded,
the company will comply with SEC and NYSE regulations regarding the filing of
financial information. It will conduct conference calls regarding that
information and respond to requests for information consistent with SEC and
NYSE regulations as has been past practice.


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Forward looking statements in this report, including, without limitation,
statements relating to the Company's plans, strategies, objectives,
expectations, intentions and adequacy of resources, are made pursuant to the
safe harbor provisions of the U.S. Private Securities Litigation Reform Act of
1995. These forward looking statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results, performance
or achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such forward
looking statements. These factors include, among others, the following: the
success of pending applications for rate increases, inability to obtain, or to
meet conditions imposed for, regulatory approval of pending acquisitions,
weather conditions that tend to extremes of temperature or duration;
availability, terms and development of capital; business abilities and
judgment of personnel; changes in, or the failure to comply with governmental
regulations, particularly those affecting the environment and water quality;
competition; success of operating initiatives, advertising and promotional
efforts; existence of adverse publicity or litigation; changes in business
strategy or plans; quality of management; general economic and business
conditions; the ability to satisfy the conditions to closing set forth in the
definitive agreement; and other factors described in filings of the Company
with the SEC. The Company undertakes no obligation to publicly




update or revise any forward looking statement, whether as a result of new
information, future events or otherwise.


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