The life business represents an eternal fit. In 1999, the Suez group had acquired for $ 1 billion with 67% of the capital, its affiliate american United Water it did not already own. Thursday, July 26, the company hex announced that it has signed an agreement with the infrastructure fund, the Dutch PGGM to give him 20 % of the Suez Water Resources Inc., that includes the activity of water is regulated by the French in the United States, to $ 601 million (approximately 514 million euros).
A score of suitors presented themselves to the auction organized by Suez. “These assets have been very well valued. We sold well above the value that is recorded in our accounts “, highlights Jean-Louis Chaussade, ceo of the giant of the environment since December 2007.
The redemption of United Water – become Suez Water had allowed the old Lyonnaise des eaux to take the second place in a u.s. market of water especially fragmented, behind the leader American Water. Located in fifteen States, mostly in the Midwest and the North-East – of-Idaho-New Jersey –, Suez provides water services and sanitation coverage to 7.4 million Americans in the framework of agreements with municipalities.
Alleviate the group’s debt
This market has the advantage of providing a return determined in advance in function of investment. But the financial efforts needed to upgrade ageing networks are very high. This issue was illustrated by the scandal of Flint, the Michigan city where the inhabitants have been contaminated with lead and still do not have tap water for drinking because of pipes eaten away by corrosion.
Hence the importance, for Suez, to reconstruct the financial margins. “The proceeds of this sale will be used to help us deleverage “, said Mr. Chaussade, who had promised to alleviate the debt…