Today Caisse de dépôt et placement du Québec and SUEZ announced that they have entered into an agreement with General Electric Company to acquire its Water & Process Technologies business ("GE Water"), a leading provider of water treatment solutions.
The transaction values GE Water at approximately USD 3.4 billion. As part of the transaction, CDPQ will invest over USD 700 million for a 30% stake. SUEZ will have a 70% stake and will contribute its industrial water business to GE Water to create a new self-standing business unit within SUEZ encompassing all industrial water activities with a global focus.
With operations in 130 countries and over 7,500 employees, GE Water is a global leader in the provision of equipment, chemicals and services for the treatment of water and wastewater. In order to address its industrial clients’ increasingly complex needs, GE Water invests heavily in research and development of unique solutions. Its innovative technology has made it one of the most sophisticated players in its industry.
Long-term demand for water treatment equipment, chemicals and services are expected to remain strong both as a consequence of growing water scarcity and the impact of global warming on the water cycle. Furthermore, there are increasing global concerns related to industrial wastewater and its impact on the environment which make advanced treatment of water an absolute necessity. In this context, CDPQ is looking to increase its exposure to the water sector and views this investment as a way to generate long-term value.
"With an emphasis on industrial applications, GE Water has positioned itself as a key player in the water treatment industry thanks to its cutting-edge technology and a management team that has proven itself highly skilled at leveraging that competitive advantage," said Michael Sabia, President and Chief Executive Officer at CDPQ. "Operating in a core industry, GE Water has built a premier business with recurring revenues and a high-quality and diversified customer base. This investment is therefore highly aligned with CDPQ’s long-term vision and its strategy of increasing its emphasis on stable assets anchored in the real economy, alongside a world-class operator such as SUEZ."
Jean-Louis Chaussade, CEO of SUEZ, said: "I am very proud to announce the acquisition of GE Water, which will accelerate the implementation of SUEZ’ strategy by strengthening its position in the promising and fast-growing industrial water market. This combination will create further value for both our clients and shareholders. Clients will benefit from the combined knowledge, expertise, geographic footprint and leading edge products and services available. The transaction will also deliver strong value to our shareholders by enhancing SUEZ’ profitable growth profile. I look forward to integrating GE Water’s highly skilled staff to our teams to form an unparalleled industrial water platform. We are also thrilled to join forces with CDPQ, a financial investor which shares our long term vision for our business."
SUEZ is a French, publicly-listed industrial services and solutions company focused on water optimization and waste recovery. By teaming with SUEZ, CDPQ gains a strong partner which can help accelerate the growth and success of GE Water.
Next Finance , March 13