French environmental services provider Veolia posted "record results" in the first half of the year, its CEO Antoine Frérot said on Thursday morning. "Just as Veolia is about to acquire Suez, the Group has never been in better shape," said Mr Frérot at the presentation of the company's first-half figures. Veolia increased its turnover by 10 per cent to €13.6bn and posted a net profit of €301m as net income group share, compared to a net loss of €138m in the prior-year half. Having come in ahead of its objectives for the first six months of the year, Veolia raised its targets for 2021.
Suez had also returned to profitability in the first half of the year. "Our performance is improving very strongly on all levels, showing a clear acceleration compared to 2019 and a strong rebound relative to 2020," said Suez CEO Bertrand Camus. Revenue improved by 7 per cent to €8.7bn, while net profit group share turned around from a loss of €538m for the first half of 2020 to a profit of €298m. The recovery in turnover and results at both groups had reportedly been driven by factors including a rebound in waste volumes and high secondary raw material prices.
Tender offer for Suez shares open
Veolia has also received the green light from French financial markets regulator AMF to open the public takeover bid for Suez. Veolia is offering Suez shareholders a price of €19.85 after the payment of a €0.65 dividend by Suez in early July. This equates to an offer of around €8.75bn for the outstanding 70.1 per cent. In October 2020, Veolia had already acquired 29.9 per cent of Suez's shares for €18 per share, amounting to about €3.4bn.
Veolia expects the transaction to be completed as planned before the end of the year. The closing of the transaction remains subject to competition clearance by the EU Commission, which the parties expect to receive in November or December. Upon completion of the acquisition, Suez's French waste management and water businesses and water activities in some international markets will be spun off in a "new Suez" concern which is to be sold to a consortium of primarily French investors.