PARIS (Agefi-Dow Jones)–Veolia announced on Monday that it will sell Suez’s UK waste business to asset manager Macquarie Asset Management, to address concerns from the UK competition authority. concerning the merger of the two French groups of services to local authorities.
The operation represents sale proceeds of around 2.4 billion euros for Veolia, the group said in a press release. “The valuation level of this sale, showing a multiple of 16.9x normalized 2021 EBITDA, stands at a level significantly higher than the acquisition price resulting from the takeover price” on Suez closed at the start of the year. year, said Veolia. Veolia’s takeover bid for Suez was based on a multiple of around 9.5 times EBITDA, Veolia CEO Estelle Brachlianoff said in a conference call with reporters.
The sale price of the assets in the United Kingdom “allows to immediately crystallize the value of all the synergies then envisaged”, added the group.
Veolia hopes to complete this operation by the end of the year, indicated Estelle Brachlianoff, specifying that Suez had a period of 30 working days to exercise its right of first refusal on the offer, under the same conditions.
The Competition and Markets Authority (CMA) in the United Kingdom, the last competition authority to have yet approved the combination of Veolia and Suez, will also have to give its approval to the transaction announced on Monday. Estelle Brachlianoff said Monday “very confident” about obtaining this agreement.
The CMA must announce its decision on the merger of the two French groups by September 11, 2022.
“Following the completion of this antitrust remedy, Veolia will remain a major player in the waste treatment market in the United Kingdom with a turnover of approximately 2 billion euros”, underlined Veolia.
In order to respond to all of the CMA’s concerns, Veolia still has to make a sale in the industrial water sector in the United Kingdom, an activity which represents 10 million to 20 million euros in turnover, a clarified Estelle Brachlianoff.
All of the antitrust disposals made worldwide represent approximately 3.4 billion euros, and will “reduce the group’s debt leverage significantly below 3x”, added Veolia. Last week, when presenting its half-year results, Veolia indicated that it was expecting debt leverage to be around 3 times by the end of 2022.
These disposals will thus give the group “additional leeway to invest”, particularly in energy and water treatment, in particular in Europe and the United States, explained Estelle Brachlianoff.
-Alice Doré, Agefi-Dow Jones; +33 (0)1 41 27 47 90; [email protected] ed: LBO
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August 08, 2022 02:50 ET (06:50 GMT)