Veolia presents new proposal for Suez

Veolia CEO Antoine Frérot
Veolia CEO Antoine Frérot offers "outstretched hand"
11.03.2021 − 

In an effort to speed up what it believes to be its "inevitable" merger with rival Suez, French environmental services Veolia presented a "balanced compromise" in Paris on Thursday morning. Veolia's new proposal would see all of Suez's French operations, including both its waste and water divisions, acquired by the investment fund Meridiam. This was "a solution that would allow Suez to maintain its position in France, thanks to a solid and long-term investor", Veolia said. Meridiam is prepared to double its investment over the next five years and to hold Suez for at least the next 25 years, according to Veolia.

Until this point, Veolia's takeover plans for Suez had involved selling only Suez's French water business on to Meridiam. In the event of a merger, Veolia would have to part with these activities in order to secure anti-trust clearance. This new "outstretched hand" showed the concern's determination to complete the merger project "preserving a strong competition", Veolia said. If approved by Suez's board of directors, Suez "would remain unchanged in France with its scope of €5bn in revenues and its more than 25,000 employees".

If it proceeds on the basis of the proposal presented on Thursday, Veolia would only take over its competitor's waste management and water activities outside of France. Following rumours of a possible sale of Suez waste management activities in Australia and the UK, Veolia had accused its competitor of "self-sabotage" in a statement last Sunday evening and threatened legal action against members of the board of directors if the sale went ahead. According to Veolia, the activities concerned account for around 80 per cent of Suez's waste management business outside France. Veolia considers them to be of strategic importance. It is not unlikely, however, that Veolia will also have to dispose of assets in these foreign markets in order to be granted permission for the merger from competition authorities.

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