Veolia, Transdev merger moves a step closer

By: Graham Gardiner

The merger of public transport giants Veolia and Transdev has moved a step closer with the drawing up of a

The merger of public transport giants Veolia and Transdev has moved a step closer with the drawing up of a framework agreement for the coming together, which covers the financial structure of the new group.

This follows completion of standard due diligence investigations and agreement on the basis of homogeneous multi-criteria valuation methods.

Parent companies Caisse des Dépôts and Veolia Environnement say this framework agreement will be presented to relevant administrative authorities and corporate bodies of the parties, and to the relevant employee representative bodies for the purpose of their information and consultation.

RATP has confirmed that, prior to the merger of Veolia Transport and Transdev, it will exchange its 25.6 percent stake in Transdev for certain French and international assets of Transdev and Veolia Transport, for a total value equal to that of its stake.

RATP, Caisse des Dépôts and Veolia Environnement will continue their discussions relating to the assets to be transferred to RATP and are confident of quickly reaching agreement.

Based on the foregoing, Caisse des Dépôts and Veolia Environnement have decided to extend the exclusivity period for their discussions toward the conclusion of definitive agreements.

The merger of Veolia Transport and Transdev would be carried out by way of contribution of Veolia Transport and Transdev to a new entity, initially called Veolia-Transdev, held by Veolia Environnement (50 percent), acting as the industrial operator of the new group, and by Caisse des Dépôts (50 percent), acting as long-term strategic shareholder.

Prior to the completion of the transaction, Caisse des Dépôts will subscribe to a capital increase of Transdev of 200 million euro.

The new group would then be listed through a capital increase, as soon as market conditions permit.

The new group would rank among world leaders in passenger transportation and mobility, with revenues of circa 8 billion euro, and a workforce of more than 120,000.

It would have an outstanding geographic complementary fit in France, Europe and the rest of the world, with expertise in all transport means.

The new group’s positioning should enable it to generate major development synergies. Additionally, the new group would benefit from the strengths of its two main shareholders.

Through this transaction, RATP would become the third largest French player in urban transportation (excluding the greater Paris region) and would substantially strengthen its European footprint. It would thus pursue the implementation of its industrial project and increase its ability to continue its development by leveraging its know-how.

Once completed, the merger of Transdev and Veolia Transport would be subject to a decision by the Directeur Général of Caisse des Dépôts, after consultation with the Investment Committee of Caisse des Dépôts’ supervisory board, and by the board of directors of Veolia Environnement.

The transaction will be subject to governmental authorisation upon clearance by the French Commission des Participations et des Transferts. It will also be subject to prior authorisation by anti-trust authorities.

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