PARIS (Reuters) - French power group EDF (EDF.PA) and water and waste company Veolia Environnement (VIE.PA) are close to a deal to split the domestic and international assets of their Dalkia energy services venture, they said on Monday.
The agreement being discussed would see Veolia pay EDF 550 million euros ($758 million) in cash to give it Dalkia’s foreign business, while EDF would take over the French division, the companies said in a joint statement.
“The transaction would benefit all parties, as it would secure Dalkia’s development both in France and internationally, while strengthening EDF and Veolia Environnement’s respective ambitions in the energy services,” the companies said.
“The contemplated transaction would also put an end to the litigation between EDF and Veolia Environnement pending before the Paris commercial court.”
The transaction would be neutral for the net financial debt of Veolia, which currently provides most of Dalkia group financing.
For EDF, the transaction would improve its ratio of net debt to EBITDA (earnings before interest, tax, depreciation and amortization), the companies said, adding that a deal was “in sight”.
Dalkia reported 2012 revenue of 4.1 billion euros in France and 4.9 billion abroad. Veolia, formerly run by EDF Chief Executive Henri Proglio, holds 66 percent of Dalkia Holding, and EDF 34 percent.
($1 = 0.7254 euros)
Reporting by James Regan; editing by David Evans