French energy group Engie retains Bouygues' bid to buy services unit
PARIS (Reuters) -Engie has retained French conglomerate Bouygues’ bid to buy its Equans services division, the French energy group said on Friday after its board met to consider offers.
Engie said it was entering exclusive talks 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, at 7.1 billion euros ($8.20 billion).
With 12 billion euros in annual revenue, Equans’ purchase would make industrial services one of Bouygues’ biggest activities alongside interests ranging from construction to telecoms and media.
At Engie, the sale of the division forms part of a broader sale of non-core assets as the group shifts its focus to renewable energies. Engie said nearly all of the proceeds from the deal would go to paying down debt.
Bouygues’ offer was in competition with rival bids from French civil engineering group Eiffage and U.S. private equity group Bain Capital after French engineering firm Spie and U.S. private equity firm Carlyle withdrew earlier.
“Bouygues’ offer was the most compelling taking into account all criteria including financial valuation,” Engie said in a statement.
Less than six months from a presidential election, the deal is politically sensitive given that Equans is a major employer in France with 27,000 people on its payroll in the country and the French state is Engie’s biggest shareholder with a nearly 24% stake.
To win over Engie and unions, Bouygues pledged to make no forced redundancies over five years in France and Europe and create 10,000 additional jobs over the period.
The family-controlled Bouygues also said this week it would not need a capital increase to finance the deal.
Engie said the transaction was expected to close in the second half of 2022.
($1 = 0.8655 euros)
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