Veolia's planned purchase of a major stake in competitor Suez is on ice, at least for the moment. On Friday afternoon the judicial court of Paris issued a temporary injunction, ordering the suspension of the transaction. The court order was announced by the chapter of trade union CGT representing the employees of Suez's French water business.
On Monday evening, the French energy utility Engie decided to sell a 29.9 per cent stake in Suez to Veolia for around €3.4bn. Veolia intends to achieve full ownership of Suez through a public offer. Suez considers Veolia's action as a hostile takeover bid.
The injunction issued by the Paris court had been sought by the works councils of the Suez group companies. According to the news agencies AFP and Reuters, the suspension order will remain in force until the workers' councils have been "informed and consulted" on Veolia's decisions. French media predict that this procedure could take two to three months. However, the consultation ordered by the court would not give the employee representatives any authority to block or hinder the transaction.