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Engie says Veolia's bid for Suez is too low

  • Engie says Veolia's bid for Suez is too low
    Image: Wikipedia

Jean-Pierre Clamadieu, Chairman of Engie, said on Friday that Veolia’s proposal to purchase the majority of the company’s stake in Suez for 2.9 billion euros ($3.4 billion) is too low, reports Bloomberg. Clamadieu added that there might be other bids to consider, indicating that Veolia may have to bid higher for its participation in Suez.

On Sunday, Engie received a proposal to buy 29.9% of its capital in Suez by the French utility’s rival Veolia, the first step to a full takeover. Veolia stated that this move would enable it to: “build the French world champion in ecological transformation.” Meanwhile, on Monday Suez responded that facing Veolia’s unsolicited offer carried great uncertainties.  

Speaking on BFM Business television, Clamadieu said: “The value of Suez is higher than the basis of these discussions,” as shown by the 5.7% jump in Veolia shares Monday. He said that the company should offer a higher bid for the Suez shares and that Engie would examine the possible new offer with “great care if it can be implemented rapidly.”

He added that in some ways, the plan to create a French world champion in ecological transformation was “attractive.” As well as asking Suez and Veolia to talk to see if Veolia could raise its proposal and make the offer more “inclusive” for Suez’s management and employees.

Previously, Philippe Varin, Chairman of Suez, restated his support for Camus and the company’s strategic project “SUEZ 2030” on BFM Business television on Thursday. Suez Chairman said that the board has encouraged Camus to seek alternatives to Veolia’s offer.

According to Bloomberg, the French government, which owns 24% of Engie, showed support for Veolia’s offer on Thursday by saying that the proposed deal “makes sense.”

Prime Minister Jean Castex said that any proposal should preserve jobs and avoid the creation of monopolies in water and waste, and that it he would prefer having a French investor in Suez to avoid “a loss of sovereignty in this strategic industry.”

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