Veolia’S Hostile Takeover Paralyzed Suez And French Courts

2021-02-08   |   by CusiGO

On Monday, a French Court banned Veolia from launching a hostile takeover, as it announced on Sunday for Suez. This is another step that has exacerbated the business war that the two companies have been waging for months. Veolia, which has 29.9 per cent of Suez since last autumn and is its largest shareholder, announced on Sunday that it would launch a new acquisition for the remaining 70 per cent at 18 euros a share. As a result, the company is worth 11.3 billion euros. Following the announcement, Suez claimed on Monday that an order from the Nanterre commerce court prevented Veolia from launching a takeover offer. However, the French multinational responded that its offer was valid because it predated the court order.

From the beginning, the French government tried to find a compromise solution and rejected the movement. In addition, it pledged to refer the matter to the Financial Markets Authority (the French securities regulator) to analyse its potential impact on competition and employment. “This proposal is unfriendly and goes against Veolia’s promise. It also raises the issue of transparency. Why did the proposal come out of the blue? We will report to the financial markets authority this morning, “finance minister Bruno le Maire said on Europe 1 radio.

“The Nantes Commercial Court prohibited Veolia from announcing a hostile public offering on February 7 after Veolia attempted to breach its goodwill commitments,” Suez said in a statement. Through this step, the company actually withdrew the commitment to purchase on the condition of the Suez Management Committee’s green light. “Our offer is valid. Antoine fr é rot, Veolia’s chief executive, retorted in a Le Monde statement: “it’s going on.”. The executive argued that the acquisition had been submitted to the securities regulator at 7:23 on Monday before the court order.

Veolia became Suez’s largest shareholder when it acquired nearly 30% of engie’s shares for 18 euros a share last autumn. After that, the two sides reached a friendly agreement to increase their shares. “In the past four months, Veolia has been in a position to increase its shares, Suez has increased its action, focusing on blocking Veolia’s proposal, “the company explained on Sunday, trying to demonstrate a shift in its intentions.

Fr é rot guarantees that the program is accompanied by all safeguards for the maintenance of employment and social welfare in France. However, Suez believes that this will have a negative impact on employment and competition. In addition, a Suez spokesman said he did not understand the new shift in acquisition intentions: “this move shows that we have never intended to act in a friendly manner.”. The company’s unions said in a statement that they would oppose what they called Veolia’s “Declaration of war.”.

In the past few months, Suez has tried to block the deal by protecting its water treatment assets (a market that competes with Veolia, which also works in waste management and energy), and another decision has ended in court. The company also said another offer from GIP and the adian fund of 18 euros a share had not been successful. Among other things, as Veolia points out, its shares are not for sale. A board meeting is expected to be held in the next few months to clarify its position.

The French government wants these companies to restart negotiations to reach a common solution. Lemaire insisted that only in the case of friendly consultation, the operation can be successful. “French capitalism cannot be an all to all war,” the Minister stressed, adding that for him, all parties must be reasonable and have a concept of the general interest, as it involves thousands of jobs.