Veolia and SUEZ have reached an agreement in principle that will allow a merger between the two groups to proceed with an improved offer price of €20.50 per share (coupon attached) on the conclusion of the acquisition agreement. The offer, which represents a significant premium on the intrinsic value of SUEZ, can be redeemed wholly in cash and may also include an option to receive Veolia shares for part of the shareholders who want to participate in the enlarged group’s future.
The agreement allows the implementation of Veolia's plan to create a global champion of ecological transformation, with integrated leadership, post-merger revenues of around €37 billion including all five strategic SUEZ assets identified, and industrial synergies delivering significant value creation for Veolia shareholders today and for years to come. This combination will have a unique and lasting impact for employees, whose dedication was key throughout this process and will be paramount for a successful integration.
The groups have also agreed on the formation of a new SUEZ, a significant and sustainable group from an industrial and social standpoint, with revenues of around €7 billion and majority long-term French investors in Meridiam and its French partners, who have committed to a significant four years of job security for SUEZ employees. The new group will have real growth potential thanks to a significant international presence (over €1bn in turnover) and all the necessary engineering, technological, service and digital skills in house. This is good news for customers, local authorities and public authorities.
The agreement includes key commitments that neutralize the areas of concern for Veolia in its recent campaign.
Both parties have made a commitment to reach a final agreement by May 14th and will work together to obtain all necessary authorizations including antitrust and, of course, shareholder approval at the AGM. It is expected that the timeline presented by Veolia will be tremendously accelerated by this agreement and it is hoped that the takeover bid will be completed at the very beginning of the autumn.
Read the full announcement, including statements from Veolia and SUEZ leadership:
April 12, 2021
"This agreement is beneficial for everyone: it guarantees the long-term future of SUEZ in France in a way that preserves competition, and it guarantees jobs. All stakeholders in both groups are therefore winners. The time for confrontation is over, the time for combination has begun"Antoine Frérot, Chairman & CEO of Veolia
April 12, 2021
“The deal comes at a time when governments world-wide are boosting spending on infrastructure as part of efforts to recover from the pandemic and overhaul their economies to meet commitments under the Paris climate accord.”Nick Kostov, Wall Street Journal