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Veolia, locked in Suez takeover stand-off, eyes 2021 sales rebound

25 Feb 2021 / 14:43 H.

    PARIS, Feb 25 (Reuters) - French water and waste management firm Veolia, which is locked in a battle to acquire rival Suez, said on Thursday that it aims to return to its pre-pandemic level of sales this year after a fourth-quarter rebound.

    The company said talks with Suez about its takeover offer were currently at a standstill.

    Revenue was up 0.9% in the October-December period at constant exchange rates, turning positive after the COVID-19 pandemic weighed on Veolia's business in the previous three quarters.

    Earnings before interest, taxes, depreciation and amortisation (EBITDA) in the reported quarter recovered further, rising 4.2% at stable exchange rates, compared with a 1.7% gain in the third quarter.

    A pick-up in businesses such as hazardous waste, where it is making a push including in China, and the return of some construction activity offset the hit from lower waste collections for restaurants that remain closed due to lockdown restrictions.

    Annual like-for-like sales were down 2.5% at 26 billion euros ($31.65 billion), Veolia said, adding that in 2021 it expects sales to exceed 2019 levels, when they had reached 27.2 billion euros, with Ebitda also rising.

    The French company reported 415 million euros in current net income, which strips out some charges, down 45% from last year.

    Earlier this month, Veolia launched a bid for Suez shares it does not already own, after buying a 29.9% stake last October, in a deal that would value its target at 11.3 billion euros.

    But, Suez pushed back, partially citing fears over jobs, leading to a legal battle.

    "There are no discussions at the moment," Veolia Chairman and Chief Executive Antoine Frerot told Reuters on whether he had talked to Suez executives since launching the bid. Frerot said there was no need to bring in mediators.

    "I would like to be able to discuss it with the board (of Suez). We can be our own negotiators," Frerot said.

    Unless a deal is struck beforehand, the takeover tussle is likely to reach a head at Suez's shareholder meeting later this year, when some investors might seek board changes.

    ($1 = 0.8214 euros)

    (Reporting by Sarah White and Gwenaelle Barzic, Editing by Sherry Jacob-Phillips)

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