Brussels authorized Tuesday 13 December the French Veolia to absorb its historic rival Suez, an operation at 000 billion euros sealed in the spring after months of epic battle between the two giants of water and waste . To get the green light from the European Commission, which watches over competition in the European Union, Veolia, world number one in its businesses, had to commit, as planned, to notably sell most of Suez’s activities in France.
The closing of the public tender offer (OPA) will take place on January 7 2022, indicated for its part the Autorité des marchés financiers (AMF) in Paris on Tuesday evening. It should actually be carried out in 18 January and will allow the group to resume approximately 60% of the activities of its competitor. The rest of the assets, by virtue of a “cease-fire” agreement reached this spring between the two enemy brothers, will in the process be ceded to a consortium of shareholders, to create a “new Suez”, independent, although diminished. The Brussels downstream was the only condition precedent included in Veolia’s takeover bid.
To win, the former Générale des Eaux will have to sell “almost all” of Suez’s activities in waste management and municipal water in France, confirms the Commission. It is this sale that should give rise to the creation of the new Suez group, refocused mainly on water and on France. It will be approximately 40. 60. 000 employees for nearly 7 billion euros in turnover. It will also keep assets, particularly in Africa (Morocco, Senegal), India, China, Poland. Held by a consortium made up of French Meridiam and American GIP funds, at 37% each, alongside Caisse des Dépôts / CNP Assurances, it will be withdrawn from the Paris Stock Exchange.
New commitments requested
But the Commission has also asked Veolia for new commitments: the sale of “almost all” of its activities in mobile water services in the European Economic Area, “the vast majority” of Veolia’s activities in industrial water in France and “part” of the activities of the two companies in the treatment of hazardous waste, said the European executive on Tuesday, after several months of discussions with the parties. “The group has agreed to some additional remedies”, confirms Veolia in a press release.
The group will however absorb a large part of Suez’s activities internationally : its turnover will increase by 50% in North America, will double in Latin America, will be “significantly” increased in the United Kingdom and Spain. It will see its workforce drop from 150. at 230.000 employees and its turnover of 20 to 29 billion euros. It will thus consolidate its position as world number one in the sector, even if it will still represent only around 5%, in a fragmented world landscape.
” question of weeks “
Veolia, which currently owns 27 , 9% of the capital of Suez (acquired in October 2020 from the French energy company Engie), had launched on 29 July 2021 a takeover bid on 70, 1% remaining. Suez fought for a long time to avoid this outcome. But, after eight months of a financial, political, judicial and media standoff between the two rival groups for 70 years, he had to resolve to buy back, in April 2021, after mediation.
The purchase price was then raised at 20,50 euros per share, valuing the target at some 13 billion euros. With the green light from Brussels, Veolia has already obtained the approval of 15 authorities of the competition on 18 file seizures. The group is still awaiting authorization from the authorities of the United Kingdom, Chile and Australia, but only the decision of the European Commission was likely to block the takeover.
” This step opens the last phase of the merger which is only a matter of a few weeks, “reacted Tuesday the CEO of Veolia, Antoine Frérot. “I want it to be done in the best conditions for all of our stakeholders, and I will ensure that all of our social commitments are respected throughout this process,” he said. he adds. Antoine Frérot’s group, who carried out an acquisition already attempted in 230 then 2006, promised to maintain employment for four years. The consortium at the head of the “new Suez” is committed over five years.