French water giant doubles size with US acquisition
In a massive deal for the water industry, French communications and utilities giant Vivendi has snapped up US Filter (USF) for a cool $6.2Bn.
The acquisition, approved by the boards of both companies, is the largest acquisition ever made by a French company in the US and will result in a cash bonus of $31.50 per share for USF stockholders.
Once completed, the merger will nearly double the turnover of Vivendi’s water treatment activities, carried out by its subsidiary Générale des Eaux. With a combined annual revenue of $12Bn, Générale des Eaux and USF will now have few, if any, rivals in terms of global water sector market share.
World-wide, Générale des Eaux has benefited from the trend towards privatisation and now provides water and wastewater treatment services for nearly 90M people, on every continent.
Founded in 1990, equipment manufacturer USF has since pursued an aggressive acquisition strategy, resulting in mergers with specialised water treatment firms like Memtec and Culligan. The company now claims annual sales of $5Bn, from humble beginnings of just $16M.
As a major multinational corporation, Vivendi employs 235,000 people and has a turnover of $35Bn. The acquisition of USF is therefore a highly significant move, expected to boost Vivendi’s revenue by at least 14.3%.
USF chairman Richard Heckmann will now serve on Générale des Eaux’s board of directors and Vivendi’s water group executive committee.
Announced on the UN World Day for Water (22 March), the deal remains subject to regulatory approval for monopolies and mergers on both sides of the Atlantic, from the European Commission and under the terms of the Hart-Scott-Rodino Act in the US.
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