UPDATE 1-Suez Environnement buys rest of Spanish water unit from La Caixa

Fri Jul 18, 2014 3:10am EDT

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PARIS, July 18 (Reuters) - Suez Environnement has agreed to buy the remaining stake in its Spanish water unit, Aguas de Barcelona (Agbar), from La Caixa, which will in turn become the French waste and water group's second-biggest shareholder.

Suez said it would pay for the 24.1 percent stake in Agbar with 22 million new Suez shares and 299 million euros ($404 million) in cash, giving La Caixa a 4.1 percent holding in the French company that it plans to raise to 7 percent in the near-term.

The deal will help reinforce Suez's business in southern Europe and Latin America, and will bolster its ownership structure with a new long-term shareholder, Suez said in a statement on Friday.

The transaction will have a limited effect on Suez's net debt and a positive impact on annual net profit of over 25 million euros from 2015 onwards, Suez said.

The deal will also see Spanish lender La Caixa use some of the cash to buy a 15 percent stake in Aigues de Barcelona, which manages water and waste in the Barcelona area, from Agbar and a 14.5 percent holding in Aguas de Valencia from Suez.

Taking those transactions into account, the deal will cost Suez 200 million euros in cash, Suez Chief Executive Jean-Louis Chaussade said on a conference call.

La Caixa will also appoint a member to the board of Suez who will sit on its strategy committee. It has agreed to hold on to its Suez shares for at least four years.

Chaussade said he expected the deal to be completed by the end of the year.

French utility GDF Suez remains Suez' top shareholder with a 36 percent stake. The stock has lost around 10 percent in the last month, but remains up 5 percent since the start of the year. ($1 = 0.7396 Euros) (Reporting by James Regan and Gilles Guillaume; Editing by Astrid Wendlandt and Pravin Char)

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