French energy group Engie chooses Bouygues offer to buy the service unit



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The logo of the French gas and electricity group Engie can be seen in Nantes, France, September 28, 2020. REUTERS / Stephane Mahe / File Photo

PARIS, November 5 (Reuters) – Engie (ENGIE.PA) has selected the offer of French conglomerate Bouygues (BOUY.PA) to buy its Equans services division, the French energy group announced on Friday after the meeting. of its board of directors.

Engie announced that it had entered into exclusive negotiations with Bouygues after the group made a firm offer valuing Equans, which provides energy and facilities management services and currently employs around 40% of Engie’s total workforce, to 7.1 billion euros ($ 8.20 billion).

With 12 billion euros in annual turnover, the acquisition of Equans would make industrial services one of Bouygues’ most important activities alongside interests ranging from construction to telecoms and the media.

At Engie, the divestment of the division is part of a larger divestiture of non-strategic assets as the group refocuses on renewable energies. Engie said almost all of the deal’s proceeds would go towards debt repayment.

Bouygues’ offer was in competition with competing offers from the French civil engineering group Eiffage (FOUG.PA) and the American private equity group Bain Capital (BCSF.N) after the early withdrawal of the French engineering company Spie and the American private equity firm Carlyle.

“Bouygues’ offer was the most attractive considering all the criteria, including the financial evaluation,” Engie said in a statement.

With less than six months of a presidential election, the agreement is politically sensitive given that Equans is a major employer in France with 27,000 employees in the country and that the French State is the largest shareholder of Engie with nearly of 24% of the capital.

To attract Engie and the unions, Bouygues has undertaken not to carry out forced redundancies over five years in France and in Europe and to create 10,000 additional jobs over the period.

The family-owned Bouygues also said this week that it would not need a capital increase to finance the transaction. Read more

Engie said the transaction is expected to close in the second half of 2022.

($ 1 = € 0.8655)

Reporting by Gwaenelle Barzic, written by Leigh Thomas, editing by Rosalba O’Brien and Daniel Wallis

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