Veolia to pocket £2bn from Suez UK waste unit as CMA forces energy giant to sell
Veolia said this afternoon it plans to sell Suez’s UK waste business to Macquarie for £2bn after regulators raised competition concerns.
The French utilities giant agreed to buy smaller French competitor Suez in a £10.9bn deal last year.
However, it has had to sell parts of Suez’s waste operations in numerous regions amid concerns over how the merger deal could impact on competition within the sector.
The UK’s Competition and Markets Authority (CMA) said in June that the proposed tie-up between two of the biggest waste and water companies in the UK could lead to higher council tax bills.
The CMA said it was worried that if the two companies were not competing, councils and businesses could face higher bills, and called on the firm to address these fears.
Veolia has said the sale of Suez’s UK operations is designed to remedy this criticism by the watchdog.
Bosses at Veolia said they are confident the merger deal will now receive approval in the UK.
Estelle Brachlianoff, chief executive officer of Veolia, said: “We are very satisfied with this transaction, which is being carried out under excellent conditions that once again demonstrate the attractiveness of the environmental services business and the relevance of our proposal for remedies to the CMA.”
She added: “It will create significant value and strengthen our investment capacity in strategic markets.
“The valuation of these assets reflects both the initial price and the synergies expected from the combination, in line with all of the disposals carried out in the frame of the antitrust clearances, which are higher than the acquisition price of Suez,” Brachlianoff concluded.