Continue the war between Suez and Veolia. The board of directors of Suez unanimously rejected Veolia's offer of 18 euros per share, formalizing the No to the operation.
The offer, according to Veolia, would help create a world champion able to compete with emerging rivals in China and to develop new recycling areas to address environmental concerns. The advisers of Suez do not think so according to which the operation threatens corporate interests as it would aim at the dismantling of society, not providing clear benefits in other areas, such as innovation, and not giving sufficient guarantees on jobs.
"The transaction designed by Veolia puts the Suez 2020 plan at risk and would negatively impact the value of the Suez group," the Suez board underlined in a statement.
We recall that last October the multinational led by Antoine Frérot had already bought from Engie a 29,9% stake in Suez and the takeover bid, considered hostile by the latter, refers to the remaining 70,1 per cent.
A few weeks ago the French Economy Minister also intervened on the issue, Bruno LeMaire, which announced its intention to contact the AMF (the French Consob), asking it to take care of the dossier. Meanwhile Suez was itself also addressed to the Tribunal, but the Paris Court of Appeal ruled that there had been no formal "pre-offer" to Engie and "the appeal, unfounded, must be rejected".
The company reiterated today that “the race for size does not lead to decisive advantages in the essential services sector'. Furthermore, referring to the annual data, the board of directors points out that "the company's 2020 results confirm that the price of the Suez share proposed by Veolia is not satisfactory".
Speaking of accounts, in 2020 i revenues of Suez fell by 4,5% to 17,2 billion, but in the second half of the year the decline was limited to 0,9% on an organic basis. In the second half of the year the Ebit exceeded expectations, settling at 704 million, while the full year closed down but less than expected, at 780 million (-44,6% on 2019), affected by -303 million costs and write-downs linked in particular to the pandemic.
As for the guidance, Suez has improved its estimates for 2021 and is now aiming for revenues exceeding 16 billion euros, with a return to organic growth and an Ebit of between 1,4 and 1,6 billion.
Moving on to MY BAG, in Paris Suez shares gain 0,6% to 17,26 euros (Cac 40 -0,37%), while Veolia shares lose 1,71% to 22,97 euros.
