(AOF) – Veolia Environnement launches a tender offer on its outstanding bonds of an amount of 650 million pounds sterling, bearing interest at the rate of 6.125% per annum and maturing in October 2037 according to the terms and subject the conditions set out in the “tender offer memorandum” dated October 10, 2022. The securities are admitted to trading on the regulated market of Euronext Paris. The objective of the takeover bid for the company is, among other things, to proactively manage its balance sheet and its cost of financing.
The buyback offer also represents the opportunity for qualified holders to sell their securities. It will start on October 10, 2022 and will end at 4:00 p.m. (CEST) on October 14, 2022, subject to changes caused by the extension, withdrawal, termination, reopening or modification of the tender offer. The results are expected to be announced on October 17, 2022.
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Key points
– World leader in environmental services, born in 1853;
– Activity of €28 billion, split between water management for 38%, waste management for 39% and energy services;
– Steady increase in international activity: 21% in France, 38% in the rest of Europe, 25% in the rest of the world and the rest in the “Global business” – business services to large companies ;
– Business model based on the complementarity of the group’s 3 businesses in a logic of use and recovery via the circular economy;
– Non-operable open capital (4.5% of capital for Caisse des Dépôts and 4.1% for employees), the 12-member Board of Directors being chaired by Chief Executive Officer Antoine Frérot who, on 1
er
July, will hand over her position as Chief Executive Officer to Estelle Brachlianoff;
– Solid balance sheet despite net debt of €22.3 billion, increased by the acquisition of Suez, € billion compared to €16.5 billion in equity, and cash in excess of €15 billion which will be reinforced in 2022 by the disposals in municipal water and waste in France and in water activities internationally.
Challenges
– Impact 2023 strategy “to be the reference company for ecological transition”: growth of differentiating activities: treatment of hazardous waste, depollution of soil and industrial water, energy efficiency of industries and buildings, recycling of plastics, recovery of bio-waste, industrial ecology offers (circular economy loops, pooling of utilities, etc.) / digital reinvention of traditional businesses – water, waste, energy networks / solid revenue growth, €1 billion in cost savings on 4 years, debt ratio below 3 over the period and 2023 dividend of €1.30;
– Innovation strategy based on 3 pillars: coordination by the VERI R&D center organized into 5 departments – biosystems, environment & health, process engineering, digital innovation and industrial support / Via Veolia open innovation focused on innovative responses to needs precise / global information sharing network with 200 researchers and 200 partnerships and “Open Playground for co-construction of ecological solutions;
– 2020-2023 environmental strategy: reduction of CO2 emissions by eliminating coal-fired power plants in Europe by 2030 / GreenPath, internal platform for evaluating the environmental footprints of solutions / in France, energy autonomy of water services and of waste by 2025 / increase in the efficiency of drinking water networks;
– Execution of the partnership with Saudi Arabia in the water and waste treatment businesses;
– Benefits of diversification in the dismantling of nuclear power plants, biomethane and waste treatment.
Challenges
– Favorable impact of raw materials inflation in the energy, plastics, paper-cardboard and recycled metals branches;
– Towards the sale of British waste activities, for €2.3 billion;
– After a 13.6% increase in revenue and a 16.4% increase in adjusted earnings, confirmation of 2022 objectives: “solid revenue growth – around €37 billion with the integration of Suez, an increase from 4 to 6% of operating profit, net profit of around €1.1 billion, up 20%, debt leverage of 3 and a growing dividend with that of the earnings per share, or 40%.
Threat to the European energy system
The leading importer of German gas, Uniper posts 54% of the volumes it buys from Russia. Following the war in Ukraine, the group had to acquire the volumes it lacked on the spot market, the prices of which had exploded. In difficulty, he requested aid from the German state, which raises concerns for all European energy companies. Nevertheless the German RWE and the French Engie reacted by arguing that their situation was very different. RWE stressed that it was less dependent on Russian gas. As for Engie, it benefits from the diversification of its sources of supply, with an increase in the volumes of LNG delivered in France and contracts with Norway and Algeria. The group has also adapted its hedging strategy to strengthen its resilience.