French firm Suez said on Thursday its board has unanimously rejected Veolia’s industrial project and its takeover bid of 18 euros per share. The official opposition by Suez is a result of many months of arguments between the two French waste and water management companies.
Veolia had filed a tender offer at the beginning of February for the entire share capital of Suez for a total value of 11.3 billion euros ($13.7 billion). The main aim of the firm led by Antoine Frérot is to implement the creation of a world champion in ecological transformation.
In the press statement released on Friday, Suez stated: “A transaction that would involve SUEZ’s dismantling threatens the Group’s corporate interest.
“Veolia’s scale objective does not bring with it any clear benefits for the provision of essential services. It does not enhance technological innovation, quality of service or agility which are SUEZ’s strengths as a global leader working to meet the major challenges of the ecological transition.”
Suez also believes that Veolia’s guarantees on employment are insufficient, as they were limited to a time period. Adding that the bid also raised antitrust issues both within the European Union and the UK.
Last October, Veolia bought a 29.9% stake in Suez from Engie as the first step towards making a full takeover bid. Since the announcement of Veolia’s initial acquisition, the companies have both been dragged through the courts.
On Tuesday, the President of the Nanterre Commercial Court cancelled the order prohibiting Veolia from filing a tender offer for Suez. Certain experts say that the tussle could come to a head at Suez’s shareholder meeting in the spring, if investors make moves to shake up the board, reported Reuters.
Suez said in its statement: “The Board of Directors reiterates its wish to find a negotiated solution. It will take whatever steps necessary to make sure that Veolia does not impose its interests at SUEZ’s shareholders’ meeting.”