Narrative
Full Description
Project narrative
On January 31, 2022, financial close was reached on a deal in which a syndicate of 17 banks — including the Bank of China (BOC) — entered into a €5.250 billion EUR ($5.85992 billion USD) senior secured syndicated loan agreement with an unspecified special purpose vehicle (SPV) — a SPV jointly owned by American infrastructure investment fund Global Infrastructure Partners (GIP) (40% equity stake), a French global investor and asset manager Meridiam S.A.S. (40% equity stake), a French public (state-owned) financial institution Caisse des Dépôts Group (12% equity stake), and French insurance corporation CNP Assurances S.A. (8% equity stake) — for the acquisition of New Suez. This senior secured sustainability-linked loan (SLL) was divided into three tranches: a €750.00 million EUR ($837.13 million USD) revolver tranche with a maturity period of five years with two one-year maturity extension options and a final maturity date of December 17, 2026; a €2.250 billion EUR ($2.51139 billion USD) term loan tranche with a maturity period of three years with two one-year extension options and a final maturity date of December 17, 2024; and a €2.250 billion EUR bridge facility tranche with a maturity period of 12 years with two six-year extension options and a final maturity date of December 17, 2033. The proceeds were to be used by the borrower for the creation of "new Suez" via the merger of French utilities Veolia Environnement S.A. and Suez S.A.. In addition to BOC, the following lenders contributed to the loan syndicate: Banco Bilbao Vizcaya Argentaria, S.A. (BBVA), BNP Paribas S.A., CaixaBank S.A., Crédit Agricole Group, ING Bank N.V., Intesa Sanpaolo S.p.A., La Banque Postale, Mediobanca, Mizuho Bank, MUFG Bank, Ltd., Natixis, National Westminster Bank Plc (NatWest), Royal Bank of Canada (RBC), Société Générale S.A. (SocGen), Sumitomo Mitsui Banking Corporation (SMBC), and UniCredit S.p.A. The debt was intended to be refinanced in the short-term via subsequent debt capital markets (DCM) issuances. Each lender, including BOC, contributed €44.12 million EUR ($49.24 million USD) to the €750 million EUR revolver tranche. Record ID#102947 captures BOC's contribution. Each lender, including BOC, contributed €132.35 million EUR ($147.73 million USD) to the €2.250 billion EUR term loan tranche. Record ID#102948 captures BOC's contribution. Each lender, including BOC, contributed €132.35 million EUR to the €2.250 billion EUR bridge facility tranche. Record ID#102949 captures BOC's contribution. New Suez was a carved-out standalone industrial and social sustainable group with revenues of around €7 billion EUR (of Suez’s total €17 billion EUR). It included: Suez's Water and Recycling & Recovery activities in France (including CIRSEE, the main research centre in France), international assets in Italy, Central Europe, Africa including Morocco, Central Asia, India, China and Australia, and digital and environmental activities. In October 2020, Veolia had acquired a 29% stake in Suez, and pursued full control the company. In February 2021, Veolia blocked an offer from GIP and Ardrian for Suez. Then, in March 2021, Meridiam agreed to join Suez as a long-term investor with Veolia, allowing the company to maintain independence; the merger was expected to be completed in the first quarter of 2022. Later in March 2021, GIP and Ardian proposed a carve-out of Suez's operations, namely its businesses in France, its technology business, and some international water business, with Veolia to takeover the remainder of Suez. Veolia declined this offer; on April 11, 2021, the boards reached an agreement to on principle pursue the merge at €20.50 EUR ($22.93 USD), or €10.4 billion EUR total, with provisions for the subscriptions of social commitments for four years from the closing of the takeover date and an undertaking to maintain their investments long-term as part of the agreements. On May 14, 2021, Suez, Veolia, and the consortium signed a memorandum of understanding (MoU) for the establishment of new Suez. On October 22, 2021, consortium signed the purchase agreement. On June 30, 2021, the boards of Suez and Veolia approved the acquisition. The acquisition was completed on January 31, 2022, with the new entity known as "new Suez.".