French water company SUEZ, along with Canadian investment company Caisse de dépôt et placement du Québec (CDPQ), recently announced it has entered into a binding agreement to purchase GE Water & Process Technologies (GE Water) from General Electric Co. for a $3.37 billion (USD) enterprise value in an all‐cash transaction.
GE Water is a worldwide leading systems and services provider for industrial clients, supplying state‐ of‐the art water, waste‐water and process systems solutions to blue‐chip customers. GE Water generated ~$2.1Bn revenues in 2016 with 7,500 highly‐skilled salesmen and engineers with strong digital capabilities.
“I am very proud to announce the acquisition of GE Water, which will accelerate the implementation of SUEZ’s strategy by strengthening its position in the promising and fast‐growing industrial water market,” said Jean‐Louis Chaussade, CEO of SUEZ. “This combination will create further value for both our employees, clients and shareholders. Clients will benefit from the combined knowledge, expertise, geographic footprint and leading edge products and services available. The transaction will also deliver strong value to our shareholders by enhancing SUEZ’s profitable growth profile. I look forward to integrating GE Water’s highly skilled staff to our teams to form an unparalleled industrial water platform. We are also thrilled to join forces with CDPQ, which shares our long-term vision for our business.”
The transaction, unanimously approved by the board of SUEZ, combines two complementary players, covering the entire value chain making SUEZ a leader in water resource management. It enhances SUEZ’s long-term profitable growth, and offers an unparalleled value proposition to SUEZ shareholders.
The acquisition will broaden Suez’s access to industrial clients, with significant scale-up effect boosting the company’s go‐to‐market capabilities and sales force. It will also strengthen Suez’s international footprint in key geographies, notably in the United States and emerging markets, and help increase innovation capabilities to performance solutions.
The acquisition will enable SUEZ to realize significant cost and revenue synergies:
- The integration of GE Water will give SUEZ the opportunity to widen its systems and service offerings, leveraging SUEZ expertise in O&M and GE Water best‐in‐class digital platform InSight. The cross-selling opportunity is further increased by SUEZ and GE Water’s complementary customer base, industry verticals & value chain and geographies;
- The contribution of GE Water to SUEZ Industrial Solutions business will enable the group to further optimize its operations in-manufacturing supply chain, engineering and services deliveries;
- Finally, the transaction provides potential for further cooperation and business opportunities with SUEZ’s other businesses, notably in the areas of recycling and resources/ energy recovery
“GE Water has positioned itself as a key player in the water treatment industry thanks to its cutting‐ edge technology and a management team that has proven itself highly skilled at leveraging that competitive advantage,” added Michael Sabia, president and chief executive officer at CDPQ. “Operating in a core industry, GE Water has built a premier business with recurring revenues and a high‐quality and diversified customer base. This investment is therefore highly aligned with CDPQ’s long‐term vision and its strategy of increasing its emphasis on stable assets anchored in the real economy, alongside key operators such as SUEZ.”
