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Engie sells 29.9% of its Suez shares to Veolia against the advice of Suez



           


Veolia now holds 29.9% of the shares of its competitor Suez (photo: Suez)
Veolia now holds 29.9% of the shares of its competitor Suez (photo: Suez)
FRANCE. In a short communiqué published on the morning of Tuesday 6 October 2020, Suez took "note of the takeover by Veolia of 29.9% of its capital, in a hostile manner and under unprecedented and irregular conditions". The group had been firmly opposed to this operation since the start of negotiations on 30 August 2020.

As planned, despite a period of reflection, Engie's Board of Directors decided the evening before to sell a large part of the Suez shares it held to its competitor, Veolia. For a price of €3.4 billion, which should generate, according to Engie, "a pre-tax capital gain of €1.8 billion recorded in the 2020 accounts". According to Jean-Pierre Clamadieu, Chairman of Engie's Board of Directors, this sale will enable the company to "improve its visibility and strengthen its capacity to invest in renewable energies and infrastructure, which are the two main areas of development in the service of the energy transition".

"The group confirms that it will use all the means at its disposal to protect the interests of its employees, its customers and all its stakeholders, in particular to ensure equal and fair treatment of all its shareholders, and to avoid a creeping takeover or de facto control", completes the Suez text.

 

Commitments on jobs and benefits

The energy company Engie assures in a press release, published in the evening of Monday 5 October 2020, that "the Board has taken note of all the commitments made by Veolia and in particular its unconditional commitment not to file a hostile takeover bid following the acquisition of Engie's stake in Suez and the exchanges started between the parties in recent days on the industrial project".

In a press release, Veolia assures that at the end of this operation "100% of the jobs and social benefits of all Suez employees in France" will be guaranteed and certifies that it is indeed "a French-French operation". The group also indicates that it will preserve competition "thanks to the takeover by the French company with Meridiam mission of Suez's water business in France (which has undertaken to preserve all jobs and social benefits, to take over Suez's research and development centre and to double the investment planned to inject €800m into this new perimeter within five to seven years".

Antoine Frérot, CEO of Veolia, admitted that he was "very pleased to be laying the foundation stone today in France of a super world champion in ecological transformation. This is a magnificent opportunity for the employees, clients and shareholders of both groups, and it is a project that serves France and serves the planet".

Questioned on Tuesday 6 October 2020 on France Info, Bruno Le Maire declared "I don't believe in forced marriages. It doesn't work in life and it doesn't work in business either". The French Minister of the Economy believes that the takeover "will not work" in the absence of "an amicable agreement." "I think we were just a few centimetres away from an agreement", says Bruno Le Maire, who "hopes that discussions will resume immediately".
He castigated both the "intransigence" of Suez and the "haste" of Veolia, stressing that "hostile takeovers belong to a capitalism of the past".

 


Frédéric Dubessy


Tuesday, October 6th 2020



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