Not-so-super soaker

22 March 2021 By Christopher Thompson Follow @CGAThompson

CEO Bertrand Camus proposed carving up the group or swallowing an “irreversible” poison pill if Veolia doesn’t raise its 11.3 bln euro bid. Rival boss Antoine Frérot can afford to pay more. But in the absence of other bidders he can first try to kick out Suez’s board.

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French waste and water management company Veolia on March 21 rejected a proposal by Suez to negotiate a takeover if the two companies agreed on the sale of most of Suez's French assets to investment funds Ardian and Global Infrastructure Partners.

Suez has previously rebuffed an 11.3 billion euro takeover bid from Veolia, its top shareholder with 29.9%, saying it undervalued the company.

Suez said on March 21 that Ardian and GIP had offered 11.9 billion euros for Suez’s water and waste assets in France and some broader water activities globally. The French company said the offer was equivalent to 20 euros per share based on an enterprise value of 15.8 billion euros, above the 18 euros per share offered by Veolia for the whole of Suez.

Separately, Suez said that unless it reached an agreement with Veolia by April 20, a “poison pill” mechanism designed to ring-fence its French water assets would become “irreversible” until September 2024, hindering any deal. However, it added that the mechanism would automatically end if Veolia raised its offer price to 22.5 euros per share no later than May 5.

Veolia said it was “not interested in the dismantling of Suez” proposed by Philippe Varin, the company’s CEO.

Veolia proposed on March 10 to sell all of Suez's French activities to infrastructure fund Meridiam.

Suez shares rose by 1.3% to 18.35 euros by 0841 GMT on March 22.

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Suez has previously rebuffed an 11.3 billion euro takeover bid from Veolia, its top shareholder with 29.9%, saying it undervalued the company.

Veolia said it was “not interested in the dismantling of Suez” proposed by Philippe Varin, the company’s CEO.

Veolia proposed on March 10 to sell all of Suez's French activities to infrastructure fund Meridiam.

Suez shares rose by 1.3% to 18.35 euros by 0841 GMT on March 22.

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