Veolia said yesterday (7 March) it would announce a proposal this week to resolve its ever-escalating conflict with fellow French waste management company Suez.
A takeover battle has waged between the waste sector giants since Veolia bought a 29.9% stake in Suez from Engie in October and announced its intention to acquire the rest (see letsrecycle.com story). Suez has characterised Veolia’s approach as “hostile” throughout.
Suez has characterised Veolia’s approach as ‘hostile’ throughout the takeover attempt (picture: Shutterstock)
The latest twist in the dispute comes after news agency Bloomberg reported that Suez could sell its UK division to private equity firm I Squared Captial. The reports added that the Paris-headquartered waste and water firm is also said to be in “advanced talks” to sell its Australian business to Melbourne-based Cleanaway Waste Management Ltd for an estimated €2 billion.
Veolia issued a strongly worded statement yesterday (7 March), accusing Suez of “duplicity” and moving “from a scorched earth policy to a policy of self-destruction”. It suggested Suez’s board of directors, including chairman Philippe Varin and CEO Bertrand Camus, had decided to turn “a French asset” into a “jackpot for short-term predators”.
Today Suez hit back, saying the “only known dismantling” project planned for Suez was that proposed by Veolia. It added it did not comment on market rumours, “whether orchestrated or not”.
Interests
The protracted takeover battle has been characterised by the frequent release of tit-for-tat public statements.
Veolia said it could reduce its €18 per share offer for the Suez shares it does not already own if key businesses were to be sold
In the statement published yesterday Veolia listed several reasons why it believed Suez’s alleged deals for its UK and Australian businesses would be contrary to the company’s interests. It also said it could reduce its €18 per share offer for the Suez shares it does not already own if key businesses were to be sold or actions taken that would destroy value.
The two divisions said to be in the process of being sold represent 80% of Suez’s waste activities outside France, Veolia says. It suggests Suez is no longer working following an international growth strategy to develop its company but is instead trying to sell it piece by piece.
“Veolia is studying all legal avenues to block these disposals”
More than 8,000 employees would have to leave the Suez group if the deals were to go through, Veolia says.
It adds the deals would be contrary to the interests of France, which would see its international economic power weakened by one of its flagships, and of its own takeover project.
“It is for all these reasons that Veolia announces that it is studying all legal avenues to block these disposals and, if they were to take place, to hold those who would have authorised them personally liable,” the statement reads.
Veolia will hold a press conference this week to announce its proposal to resolve the situation.
‘Threatening’
In response, Suez said it noted Veolia’s “threatening” press release “with perplexity”. It says its board of directors ensures that the Group’s corporate interests are respected, with the objective of creating value and fair treatment for its shareholders, as well as protecting the interests of its customers, employees and stakeholders.
It says that for several weeks now it has proposed the opening of negotiations in to find a solution that respects its industrial project as quickly as possible. It reiterated this proposal and called on Veolia to be “restrained and calm” in its communications.
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Source: letsrecycle.com Waste Managment
