Veolia’s Hostile Bid for Suez Is Suspended by French Court
(Bloomberg) -- Veolia Environnement SA was ordered by a French court to suspend its hostile attempt to buy utility rival Suez SA, the latest escalation in a long-running takeover battle that is testing the bounds of the country’s corporate culture.
Veolia must hold off on making any bid that hasn’t been approved by Suez’s board until a case has been heard, a court in Nanterre ruled on Monday, in an interim decision.
Suez is arguing that Veolia’s decision to take its takeover offer directly to shareholders was “illegal” following a commitment the company made in court to keep matters amicable.
This is the latest twist in a months-long battle that’s playing out in the boardroom, the courts and the French political arena. A hostile takeover is a rare thing in France, and the unions compared Veolia’s move to a “declaration of war.“ The increasing tensions may put pressure on the government to broker a deal.
Veolia announced late on Sunday that it will make a hostile bid for Suez, offering to pay 18 euros ($21.7) a share for the 70.1% of the company it doesn’t already own.
Suez says the combination, which would create a giant in environmental services with more than 40 billion euros in annual revenue, would hurt employment and reduce competition. The French government has repeatedly urged the two companies to find an amicable resolution to the stalemate.
©2021 Bloomberg L.P.