Cleanaway has announced that it has entered into an agreement with Suez to acquire Suez R&R Australia for $2.52 billion.
In a statement released by ASX, The Suez R&R Australia Acquisition is subject to finance on terms satisfactory to Cleanaway and various other conditions.
Suez is subject to a tender offer by Veolia Environnement, so Cleanaway and Suez have agreed that Suez may terminate the Suez R&R Australia Acquisition by 6 May 2021 if there is an announcement of an agreement in principle for a takeover of Suez, and by 26 April 2021 if a superior offer for Suez R&R Australia is made and not matched by Cleanaway.
Should those dates pass without termination by Suez, Cleanaway proposes to raise equity to partially fund the transaction along with additional debt facilities. Any equity raising for the Suez R&R Australia Acquisition is intended to be undertaken by way of a pro rata entitlement offer to Cleanaway shareholders at the time of launch. Cleanaway will seek to maintain a strong balance sheet post-acquisition.
In the event the Suez R&R Australia Acquisition is terminated due to an announcement of an agreement in principle for a takeover of Suez, or other events where Cleanaway is not at fault, Cleanaway and Suez have agreed that Cleanaway will acquire a portfolio of strategic post collections assets in Sydney. The assets comprise two landfills and five transfer stations and will be acquired for $501 million subject to various conditions.
According to an article in the Australian Financial Review, Veolia, which is trying to take over the French-based Suez at a global level, is not impressed with the move due to it believing that the Australian side deal is in breach of French takeover law.
Cleanaway shares climbed to $2.46 by 1.30pm AEST.
Suez Australia has six landfill sites, almost 60 waste collection/depot sites, and just over 2,000 employees.