Veolia, Suez Strike Merger Deal

Photo Credit: Veolia

Veolia and Suez have reached an agreement in principle on the key terms and conditions of a merger worth nearly 13 billion euros.

The two groups have agreed on a price of €20.50 per Suez share subject to the signature of the combination agreement.

Veolia bought a stake in the firm last October. In February, Suez rejected an 11.3 billion euro takeover bid from Veolia (€15.50 per share).

The resulting water and waste-management giant aims to soak up a global surge in infrastructure and climate-change spending. The combined entity would generate annual revenue of €37 billion, equivalent to $44 billion, across five continents.

As part of the agreement, some of Suez’s assets will be spun off into a “new Suez,” with revenues of around €7 billion.

Its scope of this “New Suez” will be the municipal water and solid waste activities of Suez in France (including CIRSEE, the main research center in France), as well as the activities of Suez in particular in water in Italy (including its stake in Acea), the Czech Republic, Africa (including Lydec), Central Asia, India, China, Australia, and its global digital and environmental activities (SES).

“We will be vigilant to ensure that the conditions are met to reach a final agreement that will put an end to the conflict between our two companies,” says Suez Chairman Philipp Varin.

The two groups have agreed to enter into definitive merger agreements by May 14.