On 16th of September Veolia Environnement announced their acquisition plan of Suez of the outstanding 70,1% of Suez shares not held by Veolia. This will create a new giant in environmental services like waste management and water. I only own 12 shares in Veolia Environnement meaning the impact to me is small. Link to Veolia Environnements investor page is here. The total acquisition price of Suez will be 9 billion euros, Veolia is striving for annual synergies of 500 million euros split between 100 million the first year and 400 million in the second year.
In order for Veolia to acquire the outstanding 70% of Suez they have launched an rights issue to shareholders. For every 21 rights you have you can acquire 4 shares in Veolia at a price of 22,70€, yet got 14 rights for the 12 shares I have, therefore I would end up with a few right that would not be used and will be worthless unless I sell them or buy more rights. I have decided the use the rights I have, still open if the excess ones will be sold or at some point.
Veolias share closed at 32,82€ on Friday which would give me a discount of 30% to market price, something very interesting now and could be considered a good discount.
At the same time my portfolios market value has dropped below the short-term goal of 55 000€, 54 842,79€ was the closing value on Friday. A bit below target yet as I have earlier mentioned that is something that will happen from time to time. This is a good opportunity for me to review my portfolio holding, their weights and see what I find valuable to increase my positions in. By default Veolias share of my total portfolio will increase a bit.
This Fall has started with good new in my opinion, Old Republic International with their special, one-time cash dividend and now Veolia will acquire Suez.
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