Veolia issued a statement late yesterday (21 September) saying it took note that “Suez S.A. (Suez) has exercised its right of first refusal in respect of Vigie’s UK waste business and announces a unilateral put option agreement execution between Suez and Veolia under which Suez undertakes to acquire 100% of the share capital of Suez Recycling and Recovery UK Group Holdings Ltd. for an amount of £2 billion.”
Vigie is the ‘temporary’ name given by Veolia to the assets it bought from Suez – it is now selling the UK Suez business back to the ‘new’ Suez S.A.
At the same time, Veolia has reaffirmed its commitment to the UK waste market with the group’s chief executive, Estelle Brachlianoff, saying the company will continue to be a “leading player” in the UK.
Macquarie
Veolia had agreed to sell the Suez UK waste business to investment fund Macquarie last month but this now looks unlikely to happen as the UK’s Competition and Markets Authority is expected to approve the sale of Suez UK to Suez S.A.
The cash proceeds from the transaction represent an attractive valuation of 16.9 times 2021 normalized EBITDA, Veolia said. It noted: “The total amount of the antitrust divestments, amounting to approximately €3.4 billion, and in particular this latest transaction, will bring Veolia’s debt leverage significantly below 3x.”
Climate emergency
“The progress of the merger with Suez, which began last January, continues to demonstrate the relevance and value-creation capacity of our project to create the global champion of ecological transformation in the context of a strong climate and ecological emergency. The cash proceeds from the antitrust divestments will allow us to reduce the debt leverage and will provide Veolia with additional capacity to finance growth in high value-added markets,” said Estelle Brachlianoff, chief executive officer of Veolia.
“We are satisfied that this disposal addresses the main concerns of the UK competition authority. The UK will remain an important region for Veolia where we will continue to implement sustainable and competitive ecological transformation solutions as a leading player in the local waste management market with revenues of €2 billion.”
Subscribe for free