SUEZ ENVIRONNEMENT (EPA:SEV) Press release : Board of Directors of SUEZ

Transparency directive : regulatory news

10/09/2020 07:33

Press release

Paris, September 10th, 2020

The Board of Directors of SUEZ considers Veolia's hostile approach is against
the best interests of the company and its stakeholders.

The Board reaffirms the strong value creation embedded in SUEZ' strategic plan
as a standalone company.

The Board of Directors of SUEZ met yesterday and, after a thorough review,
unanimously1 concluded that the hostile approach, announced by its competitor
Veolia on August 30th 2020, is against the best interests of SUEZ and all its
stakeholders, and in particular its shareholders, its employees and its
clients. The Board affirms its full support to the management team.

The Group will shortly update the market on the progress of the SUEZ 2030 plan
and is reviewing options to accelerate this strategy in the interest of all its
stakeholders.

A HIGHLY VALUE-CREATIVE STRATEGIC PLAN

The Board of Directors reviewed the execution progress of the SUEZ 2030 plan
and unanimously(1) reiterated its full support for SUEZ' standalone strategic
plan and the management team delivering this highly value-creative plan.

SUEZ 2030 reinforces the Group as global leader in environmental services, best
positions it to address future growth opportunities as an agile, innovative and
highly technological company. It is endorsed by clients, municipalities and
employees.

The strong value creation of this plan is primarily driven by accelerated
organic growth, improved operational performance and portfolio rotation. The
quality of SUEZ' businesses and valuation references from recent transactions
or from upcoming ones as part of SUEZ' disposal program, lead to a value that
is significantly above that implied by current share price levels.

The Board of Directors concluded that the price offered by Veolia to Engie
wholly undervalues SUEZ.

VEOLIA'S HOSTILE AND OPPORTUNISTIC APPROACH RAISES SIGNIFICANT FUNDAMENTAL
CRITICISM

As communicated in the press release dated August 31st, 2020, and based on
available information, the Board of Directors has continued its thorough review
of Veolia's proposed transaction, which carries significant uncertainties and
is subject to criticism on a number of fundamental aspects.

(1) Mrs Judith Hartmann and M. Franck Bruel did not participate to the Board
meeting because of their current roles at Engie. All other Board members voted
unanimously. The Board confirmed that Ms. Isabelle Kocher was entitled to
participate.

* The overall structure of the transaction contemplated by Veolia is
questionable and exposes SUEZ and its shareholders to a long period of
disruption for the Group with a risk of a takeover on an unacceptable basis;

* Veolia's takeover project comes with major antitrust and regulatory issues in
France and abroad; specifically, the acquisition of the 29.9% stake will be,
according to SUEZ, subject to several specific regulatory approvals;

* The concept of a "Global Champion" lacks fundamental substance in the
environmental services industry, and as such Veolia's project ignores major
execution risks and dissynergies. It would lead to a break-up of SUEZ group
with substantial asset disposals that would put the Group's footprint and
technological know-how at risk. This could weaken its position for upcoming
contract renewals;

* The value creation strategy of the contemplated project is primarily driven
by significant cost synergies which has led SUEZ' 90,000 employees to voice
valid concerns over their employment and future within the Group;

* Clients, municipalities and communities in France and abroad, with whom SUEZ
interacts on a daily basis, expressed strong reluctance about Veolia's project
as it threatens to destabilize the competitive dynamics at play and puts at
risk the quality of service and innovation legitimately expected by end-
consumers;

* Concerning SUEZ' French water business, the intended disposal process for
these activities to Meridiam is not clear; its specific terms should have been
made public. It is doubtful that it brings the appropriate level of credibility
to make it an acceptable remedy to comply with antitrust rules and reassure our
clients who have already voiced their opposition to this project.

As such, the Board of Directors of SUEZ affirms its full support to the
management team to execute and accelerate the SUEZ 2030 strategic plan and to
explore alternatives to Veolia's proposal that are in the interests of the
group and all its stakeholders.

CONTACTS

Media                                 Analysts & Investors
Isabelle Herrier Naufle               Mathilde Rodie / Cécile Combeau
isabelle.herrier.naufle@suez.com      +33 1 58 81 24 32 / +33 1 58 81 55 71
+33 6 83 54 89 62

About SUEZ:
Since the end of the 19th century, SUEZ has built expertise aimed at helping
people to constantly improve their quality of life by protecting their health
and supporting economic growth. With an active presence on five continents,
SUEZ and its 90,000 employees strive to preserve our environment's natural
capital: water, soil, and air. SUEZ provides innovative and resilient solutions
in water management, waste recovery, site remediation and air treatment,
optimizing municipalities' and industries' resource management through "smart"
cities and improving their environmental and economic performance. The Group
delivers sanitation services to 64 million people and produces 7.1 billion m3
of drinking water. SUEZ is also a contributor to economic growth, with more
than 200,000 jobs created directly and indirectly on an annual basis, and a
provider of new resources, with 4.2 million tons of secondary raw materials
produced. By 2030, the Group is targeting 100% sustainable solutions, with a
positive impact on our environment, health and climate. SUEZ generated total
revenue of EUR18.0 billion in 2019.

Find out more about the SUEZ Group on the website & on social media

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SUEZ
Head Office: Tour CB21 - 16, Place de l'Iris, 92040 Paris La Défense Cedex,
France - Tel: +33 (0)1 58 81 20 00 - www.suez.com
Limited Liability Company with a share capital of EUR2,513,450,316 - Siren
(French business administration number) 433 466 570 RCS Nanterre - VAT FR
76433 466 570

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