Suez Supports Ardian Plan to Launch Takeover Bid for Company
--Suez says it supports France-based Ardian's approach to
shareholder Engie for a 29.9% stake in the waste-management
--The development came a day after rival Veolia Environnement
made an increased bid to Engie for the same stake
--Engie looks set to accept Veolia's fresh offer, according to
By Joshua Kirby
Suez SA has backed private-equity firm Ardian's plan to launch a
takeover bid for the company, the latest development in a story
that this week saw Veolia Environnement SA increase its bid for
Engie SA's shares in Suez as part of its plan to take over its
"Both Suez's board of directors and its employee shareholders
confirm their support for the letter of intent issued and made
public today by Ardian in a press release, for the acquisition of a
29.9% stake of Engie's shares in Suez, and the all-cash takeover
bid that would immediately follow for all Suez shareholders, under
the same treatment conditions," the French waste-management company
The statement comes after France-based Ardian said it had
informed Engie of its interest in acquiring a 29.9% stake in Suez
from the energy company, adding that it wanted to form a consortium
of mostly French private and public institutional investors to
launch a friendly offer for Suez.
On Wednesday, Engie seemed closer to selling the 29.9% stake to
Veolia, after the latter increased its offer by 16% to 18 euros
($21.10) a share from EUR15.50 in the initial offer.
Engie welcomed the renewed offer, which values the stake at
EUR3.4 billion, saying it was in line with expectations regarding
price and social guarantees, and adding that it would make a
decision by Oct. 5.
Suez has opposed the approach from Veolia, saying that the terms
of the new offer are vague and don't guarantee the interests of
shareholders and stakeholders.
The new bid from Veolia may, however, be too good to refuse for
Engie, according to analysts at Jefferies. The 18-euro-a-share
offer represents a 50% increase on Suez's share price on Aug. 28,
just before the announcement of the initial bid, Jefferies
"We see the price offered by Veolia as very attractive and
believe Engie will find it difficult to refuse, particularly given
its ambitions to invest in green energy," Jefferies said.
The U.S. bank added that acceptance could lead to a friendly
merger, given Veolia's concessions to Suez, including full
employment in France and integration of Suez executives into the
larger group. Veolia also promised to make a tender offer for the
remaining 70.1% of Suez on a friendly basis. Suez has been holding
out for Veolia to make an offer for 100% of the company.
It is unclear whether the EUR18 offered by Veolia for each Suez
share would be a reference price in any subsequent tender offer for
the remaining shares, Jefferies said.
Write to Joshua Kirby at firstname.lastname@example.org
(END) Dow Jones Newswires
October 01, 2020 07:37 ET (11:37 GMT)
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