Engie Said to Line Up Banks for $6 Billion Services Disposal
(Bloomberg) -- Engie SA is lining up advisers as it prepares to divest some services businesses in one of the French utility’s biggest-ever disposals, people familiar with the matter said.
BNP Paribas SA, Credit Suisse Group AG and Lazard Ltd. have been shortlisted for potential roles, according to the people, who asked not to be identified because the information is private. The banks will help Engie study strategic options for the assets, including a sale or initial public offering, the people said.
It plans to seek a valuation of around 5 billion euros ($6 billion) for the operations, which include electrical installation as well as services for heating and ventilation systems, the people said. Some private equity firms are already studying the businesses, they said.
Engie plans to start formally gauging interest next year, the people said. It hasn’t yet finalized the advisory mandates, and it may not hire all of the shortlisted banks, the people said. Representatives for BNP Paribas, Credit Suisse, Engie and Lazard declined to comment.
Shares of Engie were down 0.8% at 12:34 p.m. Thursday in Paris, giving the company a market value of about 30.9 billion euros. France’s benchmark CAC 40 Index declined 0.2%.
Engie is planning to sell billions of euros worth of assets in the coming years to raise money for renewables and other services tied to fighting global warming. In October, it sold its 29.9% stake in French utility Suez SA to Veolia Environnement SA. BNP Paribas, Credit Suisse, Lazard and boutique advisory firm d’Angelin & Co. worked with Engie on that deal.
The potential disposals follow a broad review of Engie’s giant client solutions division, which generated revenue of more than 21 billion euros last year, around a third of the group total. In its third-quarter results, Engie said it’s setting up a new entity to hold the services assets that are less aligned with its new strategic direction. Those account for as much as 13 billion euros in sales, based on 2019 results.
Engie’s interim chief executive officer, Claire Waysand, said in November the company had “a lot of work ahead” to prepare the carve-out. A formal consultation process with employees will take place in the first half of 2021, she said.
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