Energy services provider Dalkia is set to be split into two following an agreement between EDF and Veolia Environnement.
The French energy giant and the water and waste management company have entered into “advanced discussions” for the conclusion of an agreement on their joint subsidiary Dalkia, which develops biomass and combined heat and power (CHP) projects in the UK.
Dalkia is 66% owned by Veolia Environnement and 34% by EDF. In 2012 the group reported revenues of €3.8bn (£3.2bn) in the France division and €3.7bn in the International division.
As part of the negotiations, EDF would acquire Dalkia’s activities in France, while Veolia would acquire Dalkia International, which includes activities in the UK
As part of the deal, Veolia Environnement would make a cash payment of €550m to EDF to compensate for the difference in value between the stakes owned by the two companies in the Dalkia group.
In a joint statement, EDF and Veolia said that the transaction would benefit all parties.
“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 also said the transaction would end a litigation between EDF and Veolia Environnement that was pending before the Paris Commercial Court.
In October 2012, EDF sued Veolia over the right to own 50% of Dalkia. EDF said that a 50-50 split was part of a 2000 agreement and that attempts to put it in place had failed, according to Bloomberg.
- Dalkia has recently signed a 25-year contract to supply heating and hot water to 500 homes at a low-carbon development in Derwenthorpe, York.