By Mathieu Rosemain and Gwénaëlle Barzic
PARIS (Reuters) – French utility Veolia (PA:) said on Sunday it would not launch a hostile bid for the remaining shares of rival Suez (PA:), following its move to buy the 29.9% Suez stake owned by power group Engie. (PA:)
Veolia said on Oct. 1 it would buy Engie’s stake as a prelude to a full takeover bid and marking a breakthrough after weeks of hostilities between the parties.
Veolia “unconditionally commits not to file a hostile takeover bid following the sale of the shares held by Engie in Suez,” the group said in a statement, adding that any bid for the remaining capital would require approval from Suez’s board.
Veolia also told Suez’s chairman it would extend the scope of the assets eventually sold to the would-be buyer of Suez’s French water activities to international water assets.
The activities considered for sale to make the Veolia-Suez deal possible would yield total turnover of 5 billion euros ($5.86 billion), including the 2.2 billion euros generated by Suez’s French water unit.
Veolia has been trying to persuade Engie to sell the Suez stake, including by raising its bid to 3.4 billion euros. The additional guarantees it offered on Sunday to Engie’s board make that acquisition possible, Veolia said in the same statement.
French Finance Minister Bruno Le Maire, who has appealed for dialogue, said on Thursday the Suez-Veolia situation was moving in the “right direction.” The French state is a major Engie shareholder.
Suez had rejected Veolia’s overtures from the outset and created hurdles to a deal, including by putting its French water business in a foundation.
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