Business

SUEZ and Veolia complete SUEZ UK sale

Waste management company SUEZ SA has announced the completed re-acquisition of SUEZ Recycling and Recovery UK, after having agreed to a merger with Veolia in 2020. According to Veolia, the sale proceeds amount to £2 billion. The original merger was investigated by the Competitions and Market Authority (CMA) for competition concerns and ruled impermissible unless certain terms were met.

SuezThe CMA announced that both parties had agreed to the final terms of the sale – in line with the CMA’s rulings – early last month (3 November). The terms declared that Veolia must sell substantial parts of SUEZ UK’s operations including its industrial water operation and maintenance service businesses, as well as Veolia’s European mobile services business. The CMA indicated that the specified operations make up the majority of SUEZ and Veolia’s overlap in the UK. Both companies are French-owned.

SUEZ says that the return of SUEZ Recycling and Recovery UK will help speed up the company’s international growth, including supporting its October 2022 acquisition of EnviroServ – a South African waste management company.

Sabrina Soussan, SUEZ Chair and CEO, commented: “With the reintegration of SUEZ recycling and recovery UK, SUEZ reaffirms its commitment to one of the most important waste markets in Europe.

“SUEZ recycling and recovery UK has progressively transformed itself over the last few years with the development of recycling and waste recovery, particularly energy recovery. In a market that is undergoing major changes, this expertise will considerably strengthen the Group’s leadership position in new waste treatment methods wherever we are.”

John Scanlon, SUEZ recycling and recovery UK CEO, added: “As a business, we have a wealth of expertise and knowledge in delivering new treatment infrastructure and transforming services, which we look forward to sharing with our new colleagues at SUEZ.

“Our return to the Group comes at a pivotal time for the UK resources sector, with the long-awaited detail of government reforms to extended producer responsibility and consistency in collections expected soon. Going into 2023 we are ready to rise to the challenge of delivering the infrastructure and services needed to make these reforms reality and move the UK further along the path to net zero.”

History of the merger

Veolia announced its intention to purchase 70.1 per cent of SUEZ UK in August 2020 and signed an official merger agreement with SUEZ SA in April 2021. The CMA launched its investigation into the merger in October 2021.

The CMA took the review to an in-depth Phase 2 level in December 2021 and announced that the merger could lead to ‘higher prices and lower quality services’ across UK waste management activities.

Veolia responded that it ‘strongly disagreed’ with the conclusions drawn by the CMA and ‘[deplored] the lack of shared understanding of the issues related to our sectors of activity’.

The merger was reviewed by several other competition authorities around the world, including the European Commission which ruled in favour of the acquisition under a commitments package.