Caisse de dépôt et placement du Québec has partnered with French water optimization and waste recovery group Suez to acquire the water and process technologies business of General Electric Co. The deal values GE Water, a global provider of water treatment solutions, at about US$3.4 billion. It will see the Caisse invest more than US$700 million to secure a 30 percent stake. Suez will account for the remaining 70 percent of GE Water, which will form part of a new standalone business unit that includes all of Suez’s existing industrial water activities. The Caisse said the investment facilitates its increased exposure to the global water sector.
CDPQ and SUEZ acquire GE Water
MONTRÉAL, March 8, 2017 /PRNewswire/ – 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.
ABOUT CAISSE DE DÉPÔT ET PLACEMENT DU QUÉBEC
Caisse de dépôt et placement du Québec (CDPQ) is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at December 31, 2016, it held $270.7 billion in net assets. As one of Canada’s leading institutional fund managers, CDPQ invests globally in major financial markets, private equity, infrastructure and real estate. For more information, visit cdpq.com, follow us on Twitter @LaCDPQ or consult our Facebook or LinkedIn pages.
We are at the dawn of the resource revolution. In a world facing high demographic growth, runaway urbanization and the shortage of natural resources, securing, optimising and renewing resources is essential to our future. SUEZ (Paris: SEV, Brussels: SEVB) supplies drinking water to 92 million people, delivers wastewater treatment services to 65 million, recovers 16 million tons of waste each year and produces 7 TWh of local and renewable energy. With 82,536 employees, SUEZ, which is present on all five continents, is a key player in the sustainable management of resources. SUEZ generated total revenues of €15.3 billion in 2016.
Photo of GE Water courtesy of GE Corp