French Minister of Finance Bruno Le Maire yesterday said that a takeover raid by French energy and water giant Veolia Environment SA against its rival Suez SA risked destabilizing both firms unless an amicable accord could be reached.
Veolia closed in on its target on Monday after securing a deal to buy 30 percent of Suez from Engie SA, an energy player in which the French state owns a 22 percent stake.
Despite voting against the sale, the French government was overruled by Engie’s board, which agreed to pocket Veolia’s offer of 3.4 billion euros (US$4 billion).
Photo: AFP
Veolia is now poised to launch a full takeover, potentially creating a global giant supplying power generation, waste management and water services to municipalities worldwide.
French officials are eyeing the deal warily, despite pledges by Veolia to maintain jobs in the strategic sectors.
Suez’s board on Tuesday denounced a “hostile” deal made under “unprecedented and irregular conditions.”
“I don’t believe in forced marriages. I don’t think they work,” Le Maire told France Info radio, urging talks to resume between the two sides quickly.
“The deal won’t work” without an accord, he added.
“We were just a few centimeters from a deal, but we ran up against intransigence on one side and hastiness on the other,” he said.
Veolia has said it would give itself six months to find common ground with Suez and allay its fears of a breakup that it says could cost up to 10,000 jobs.
Suez has already taken a series of “poison pill” moves to try to scupper any takeover, including by placing its key French water services business in an independent Dutch holding.
That could put it out of reach for Veolia, which has said it wants to sell the French operations to meet antitrust concerns.
Suez said that “it will use all the means at its disposal ... to avoid a creeping takeover or de facto control.”
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