The offer comes as part of the bid process which is opposed by Suez and started when Veolia bought a 29.9% stake in Suez from Engie in October (see letsrecycle.com story). Both businesses are headquartered in Paris and have substantial UK operations.
Veolia on Sunday (7 February) announced its intention to offer €18 a share for the remainder of Suez in a message to Suez shareholders.
However, Suez responded by saying Veolia was “legally prevented from filing a tender offer due to the commitments they have taken and any such filing would be illegal”. It says its stance is backed by a French commercial court, said to have suspended Veolia’s tender offer.
In a statement published yesterday, Suez said: “Suez indicates that the Nanterre Commercial Court has today forbidden Veolia from filing its hostile public offer, announced on 7 February, following Veolia’s attempt to violate its commitment to amicability.
“Suez reiterates its determination to defend, by all means, the interests of its stakeholders, shareholders, employees and customers.”
Dialogue
Suez previously said in January it was willing to “open a dialogue” with Veolia (see letsrecycle.com story). It has put forward what it believes to be an “amicable solution”, which involves investment firms Ardian and Global Infrastructure Partners (GIP) wading into the battle with a proposal of their own. The proposal is predicated on there being a friendly outcome between Veolia and Suez.
“Veolia shows clearly that it has never intended to comply with its commitment to amicability”
Veolia, which is trying to create what it has described as a “world champion of ecological transformation”, said in its statement: “The management of the Suez group has on numerous occasions renewed its wish to be presented with a formal purchase offer, without ever having followed up on the offer proposal sent by Veolia on 7 January 2021.”
In his own statement, Philippe Varin, chairman of Suez’s board of directors, said: “In its letter dated 7 January to the Board of Directors, Veolia called for dialogue. Even though the first meeting in respect of these discussions has just taken place, Veolia puts an end to such dialogue unilaterally and in bad faith.
“Veolia thus shows clearly that it has never intended to comply with its commitment to amicability. Suez will defend by all means the interests of its shareholders, its employees and all stakeholders.”
Water
Veolia has proposed selling some assets to resolve competition concerns if its takeover bid is successful. This would include the sale of Suez’s French water business to Meridiam, a French infrastructure management company.
Suez has been accused of trying to thwart the move by making the business harder to sell. It has put its French water assets into a Dutch foundation to protect them.
Veolia’s CEO Antoine Frérot referenced the issues surrounding the sale of the water business yesterday. He said: “We are able to file a tender offer and take a major step forward in our project. In the interest of competition, I am more than ever willing to discuss with the management of Suez the perimeter to be reinforced around Suez Eau France that we could sell. I am convinced that this clarification further increases the chances of reaching a satisfactory agreement for all.”
Subscribe for free