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EU rejects Suez request to sanction Veolia buyout

2021-02-17T17:01:36.488Z


The European Commission has rejected a request from Suez, which wanted to sanction by Brussels the purchase of 29.9% of its capital by Veolia for violation of the merger regulation, according to a decision posted online Wednesday. The two French giants of water and environmental services clash in an industrial and stock market battle that has turned into legal guerrilla warfare. Veolia currently h


The European Commission has rejected a request from Suez, which wanted to sanction by Brussels the purchase of 29.9% of its capital by Veolia for violation of the merger regulation, according to a decision posted online Wednesday.

The two French giants of water and environmental services clash in an industrial and stock market battle that has turned into legal guerrilla warfare.

Veolia currently holds 29.9% of the capital of its competitor, a part bought from Engie in October, and wishes to acquire the remaining 70.1%, against the advice of Suez, to form a world champion.

On October 16, Suez asked the Commission to initiate proceedings against Veolia for violation of European merger law.

Read also: Between Veolia and Suez, the battle is raging

If it had been deemed admissible, this request could have led Brussels to impose a fine on Veolia and provisionally neutralize the voting rights, linked to its 29.9% stake in the board of directors of Suez.

Suez considered that the repurchase of this stake, carried out with a view to a subsequent takeover, could not legally be carried out without the merger operation having first obtained the green light from the Commission.

The European executive, however, considered that this share buyback by mutual agreement was allowed insofar as the merger project was quickly notified in Brussels.

However, in its decision which dates back to December 17 but made public on Wednesday, the Commission invokes a provision stipulating that the purchaser does not exercise the voting rights attached to the holdings concerned, except for a specific exemption granted by Brussels.

Even if his request was rejected, this last point may provide a reason for satisfaction for Suez who is trying to block the voting rights of his rival.

Contacted by AFP, Suez declined to comment on the Commission's decision.

A spokesperson, however, said the group was considering whether to appeal to the EU court.

Source: lefigaro

All business articles on 2021-02-17

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