Filed by: SUEZ
pursuant to Rule 165 and Rule 425(a)
under the Securities Act of 1933, as amended
Subject Company: SUEZ
Exchange Act File Number: 001-15232
Date: September 3, 2007
On September 3, 2007, Gaz de France and Suez presented the following slide show at a joint press conference held in Paris, France. On the same day, Suez made the slide show available on its website at www.suez.com.
Important Information
This communication does not constitute an offer to purchase, sell, or exchange or the solicitation of an offer to sell, purchase, or exchange any securities of Suez, Suez Environment (or any company holding the Suez Environment Shares) or Gaz de France, nor shall there be any offer, solicitation, purchase, sale or exchange of securities in any jurisdiction (including the United States, Germany, Italy and Japan) in which such offer, solicitation, purchase, sale or exchange would be unlawful prior to the registration or qualification under the laws of such jurisdiction. The distribution of this communication may, in some countries, be restricted by law or regulation. Accordingly, persons who come into possession of this document should inform themselves of and observe these restrictions. To the fullest extent permitted by applicable law, Gaz de France and Suez disclaim any responsibility or liability for the violation of such restrictions by any person.
The Gaz de France ordinary shares which would be issued in connection with the proposed business combination to holders of Suez ordinary shares (including Suez ordinary shares represented by Suez American Depositary Shares) may not be offered or sold in the United States except pursuant to an effective registration statement under the United States Securities Act of 1933, as amended, or pursuant to a valid exemption from registration.
In connection with the proposed transactions, the required information document will be filed with the Autorité des marchés financiers (“AMF”) and, to the extent Gaz de France is required or otherwise decides to register the Gaz de France ordinary shares to be issued in connection with the business combination in the United States, Gaz de France may file with the United States Securities and Exchange Commission (“SEC”), a registration statement on Form F-4, which will include a prospectus. Investors are strongly advised to read the information document filed with the AMF, the registration statement and the prospectus, if and when available, and any other relevant documents filed with the SEC and/or the AMF, as well as any amendments and supplements to those documents, because they will contain important information. If and when filed, investors may obtain free copies of the registration statement, the prospectus as well as other relevant documents filed with the SEC, at the SEC’s web site at www.sec.gov and will receive information at an appropriate time on how to obtain these transaction-related documents for free from Gaz de France or its duly designated agent. Investors and holders of Suez securities may obtain free copies of documents filed with the AMF at the AMF’s website at www.amf-france.org or directly from Gaz de France on its web site at www.gazdefrance.com or directly from Suez on its website at www.suez.com, as the case may be.
Forward-Looking Statements
This communication contains forward-looking information and statements about Gaz de France, Suez, Suez Environment and their combined businesses after completion of the proposed transactions. Forward-looking statements are statements that are not historical facts. These statements include financial projections, synergies, cost-savings and estimates and their underlying assumptions, statements regarding plans, objectives, savings, expectations and benefits from the transaction and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements are generally identified by the words “expect,” “anticipates,” “believes,” “intends,” “estimates” and similar expressions. Although the managements of Gaz de France and Suez believe that the expectations reflected in such forward-looking statements are reasonable, investors and holders of Gaz de France and Suez ordinary shares are cautioned that forward-looking information and statements are not guarantees of future performances and are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Gaz de France and Suez, that could cause actual results, developments, synergies, savings and benefits from the proposed transactions to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the public filings with the Autorité des marchés financiers (“AMF”) made by Gaz de France and Suez, including those listed under “Facteurs de Risques” in the Document de Référence filed by Gaz de France with the AMF on April 27, 2007 (under no: R.07-046) and in the Document de Référence and its update filed by Suez on April 4, 2007 (under no: D.07-0272), as well as documents filed by Suez with the SEC, including those listed under “Risk Factors” in the Annual Report on Form 20-F for 2006 that Suez filed with the SEC on June 29, 2007. Except as required by applicable law, neither Gaz de France nor Suez undertakes any obligation to update any forward-looking information or statements.
* * * *
Gaz de France Suez
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Creation of a World Leader in Energy
September 3, 2007
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GDF Suez
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Creation of a World Leader in Energy
September 3, 2007
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Important Information
This communication does not constitute an offer to purchase or exchange or the
solicitation of an offer to sell or exchange any securities of Suez, Suez
Environment securities (or securities of any company holding the Suez
Environment Shares) or Gaz de France, nor shall there be any sale or exchange
of securities in any jurisdiction (including the United States, Germany, Italy
and Japan) in which such offer, solicitation or sale or exchange would be
unlawful prior to the registration or qualification under the laws of such
jurisdiction. The distribution of this communication may, in some countries, be
restricted by law or regulation. Accordingly, persons who come into possession
of this document should inform themselves of and observe these restrictions. To
the fullest extent permitted by applicable law, Gaz de France and Suez disclaim
any responsibility or liability for the violation of such restrictions by any
person.
The Gaz de France ordinary shares which would be issued in connection with the
proposed business combination to holders of Suez ordinary shares (including
Suez ordinary shares represented by Suez American Depositary Shares) may not be
offered or sold in the United States except pursuant to an effective
registration statement under the United States Securities Act of 1933, as
amended, or pursuant to a valid exemption from registration. The Suez
Environment Shares (or the shares of any company holding the Suez Environment
Shares) have not been and will not be registered under the US Securities Act of
1933, as amended, and may not be offered or sold in the United States absent
registration or an exemption from registration.
In connection with the proposed transactions, the required information document
will be filed with the Autorite des marches financiers ("AMF") and, to the
extent Gaz de France is required or otherwise decides to register the Gaz de
France ordinary shares to be issued in connection with the business combination
in the United States, Gaz de France may file with the United States Securities
and Exchange Commission ("SEC"), a registration statement on Form F-4, which
will include a prospectus. Investors are strongly advised to read the
information document filed with the AMF, the registration statement and the
prospectus, if and when available, and any other relevant documents filed with
the SEC and/or the AMF, as well as any amendments and supplements to those
documents, because they will contain important information. If and when filed,
investors may obtain free copies of the registration statement, the prospectus
as well as other relevant documents filed with the SEC, at the SEC's web site
at www.sec.gov and will receive information at an appropriate time on how to
obtain these transaction-related documents for free from Gaz de France or its
duly designated agent. Investors and holders of Suez securities may obtain free
copies of documents filed with the AMF at the AMF's website at
www.amf-france.org or directly from Gaz de France on its web site at:
www.gazdefrance.com or directly from Suez on its website at: www.suez.com, as
the case may be.
Forward-Looking Statements
This communication contains forward-looking information and statements about
Gaz de France, Suez and their combined businesses after completion of the
proposed business combination. Forward-looking statements are statements that
are not historical facts. These statements include financial projections,
synergies, cost-savings and estimates and their underlying assumptions,
statements regarding plans, objectives, savings, expectations and benefits from
the transaction and expectations with respect to future operations, products
and services, and statements regarding future performance. Forward-looking
statements are generally identified by the words "expect," "anticipates,"
"believes," "intends," "estimates" and similar expressions. Although the
managements of Gaz de France and Suez believe that the expectations reflected
in such forward-looking statements are reasonable, investors and holders of Gaz
de France and Suez ordinary shares are cautioned that forward-looking
information and statements are not guarantees of future performances and are
subject to various risks and uncertainties, many of which are difficult to
predict and generally beyond the control of Gaz de France and Suez, that could
cause actual results, developments, synergies, savings and benefits from the
transaction to differ materially from those expressed in, or implied or
projected by, the forward-looking information and statements. These risks and
uncertainties include those discussed or identified in the public filings with
the Autorite des marches financiers ("AMF") made by Gaz de France and Suez,
including those listed under "Facteurs de Risques" in the Document de Reference
filed by Gaz de France with the AMF on April 27,2007 (under no: R.07-046) and
in the Document de Reference and its update filed by Suez on April 4, 2007
(under no: D.07-0272), as well as documents filed by Suez with the SEC,
including those listed under "Risk Factors" in the Annual Report on Form 20-F
for 2006 that Suez filed with the SEC on June 29, 2007. Except as required by
applicable law, neither Gaz de France nor Suez undertakes any obligation to
update any forward-looking information or statements.
Gaz de France Suez
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1. Transaction summary
2. Creation of a global leader specialised in energy
3. A value-creating transaction for all stakeholders
4. Well-balanced and fair merger terms
5. Floatation of SUEZ's Environment business, one of the world leader in
water and waste services
6. A business organisation geared towards efficiency and action
7. Conclusion
Gaz de France Suez
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1 _____________________________________
Transaction summary
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Description of the transaction
o Terms of the merger project
. New outline of the merger project approved by the board of directors of
the two Groups
. Support of the main shareholders
. Merger of equals based on an exchange ratio of 21 Gaz de France shares
for 22 SUEZ shares
. French state to hold more than 35% of GDF SUEZ
. Simultaneous distribution of 65% of SUEZ's Environment business to
SUEZ shareholders
. A stable shareholding of 35% in SUEZ's Environment business to be maintained
o Next steps and timetable
. Consultation of the employee representative bodies of both Groups
. Signing of the merger agreement by the boards of directors
. Extraordinary General Meetings of SUEZ and Gaz de France
Timetable allowing completion of the merger
as soon as possible, in 2008
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Creation of a global leader specialised in energy
o Leader in natural gas in Europe
. #1 purchaser & supplier
. #1 transmission & distribution network
. #2 storage operator
o Leader in electricity
. #5 power producer and supplier in Europe
. #2 French power producer
. World leader in IPPs, strong positions in the United States, Brazil,
Thailand, and the Middle East
o World leader in LNG
. #1 importer & buyer in Europe
. #1 LNG terminal operator
. Leader in the Atlantic bassin
0 European leader in energy services
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A solid financial profile
o A solid financial structure that reinforces an ambitious strategy for
industrial growth data -in (euro)bn
. Low debt level Revenues
. High potential for cash flow generation
. Potential for financial structure optimisation
o A key stock in the energy sector
. ~ Euro 90bn pro formamarket capitalisation* Net financial debt
. Among the top 3 listed utilities
Financial profile
2006 combined pro forma unaudited data - in Euro bn GDF SUEZ***
Revenues 71.9
EBITDA** 11.4
Current operating income 8.1
Net financial debt 13.9
* Based on spot share price as of 31/08/07. Before taking into account
the impact of the distribution of 65% of SUEZ's Environnement
activities
** Sum of SUEZ EBITDA adjusted for provisions for renewals, associates,
financial charges and Gaz de France EBITDA
*** Based on the global integration of SUEZ's Environment activities
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A clear and ambitious strategy
o Consolidate leadership positions in domestic markets (France and Benelux)
o Leverage complementarities to strengthen offers (dual gas/electricity offers,
innovatingenergy services)
o Priority given to growth in Europe in all business lines
o Strengthen development outside Europe notably in fast-growing markets
o Acceleration of an ambitious strategy of industrial development notably in
upstream gas activities (E&P, LNG, etc.), infrastructures, and power generation
A combination consistent with both Groups' strategies
allowing to boost their development.
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2 ______________________________________________________
Creation of a global leader specialised in energy
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A common strategic vision underpinned by the acceleration of changes in the energy sector
o Supply security and diversification in a context of growing energy dependence
o Sustainable development and renewable energies challenges
o Investment requirements in upstream gas activities, infrastructures, and electricity
production
o Acceleration in sector consolidation
o Increased competition among gas suppliers
o Complete deregulation of the energy-markets in Europe in July 2007
Recent changes in the energy sector have confirmed
the relevance of the merger
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An industrial player with powerful assets
o A unique combination of businesses
. Active in the entire energy value chain
. Multi-energy offers
. Geographic fit
o A good flexibility in energy generation and supply
. Diversified and efficient mix of power generation (nuclear, hydro, wind,
thermal)
. High capacity for gas-electricity arbitrage
. Diversified gas supplies with a strong LNG component
. Optimisation at a global scale (LNG) and on the European market (storage)
o A major player in sustainable development
. CO2 light generation capacities with a high portion of renewable energies
. Leader in the promotion of innovative energy services
Natural fit of the two Groups
Powerful industrial assets of the new Group
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Coherent industrial developments
Gaz de France
o Continued development in LNG: renewal of LNG tanker fleet, access to new
markets (US and UK), commissioning of Fos Cavaou LNG terminal in early 2008,
projects in development phase in Canada, Italy and India
o Increase in storage capacities: 400bcm capacity in France, new capacities in
Germany, Romania and the UK
o Expansion in E&P: Njord field brought into production; first deliveries of
LNG from Sn0hvit expected by end of 2007
SUEZ
o Increase in generation capacities worldwide
o Development in nuclear production: R&D partnership with CEA, project
studies in the UK, in Romania
o Further expansion in LNG: permits obtained for offshore terminal off the
coast of Boston
o Numerous energy services agreements signed
o Strengthening of partnerships in Spain: increased stake in Gas Natural to 11.3%,
acquisition of Crespo y Blasco
Industrial development over the last months consistent
with the strategy of the merged entity
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Growth factors Development opportunities
Strong growth prospects for the Group o Further strengthen a diversified, long-
term gas supply portfolio
o Strong demand for gas in Europe o Develop in Exploration & Production
o Necessity to secure gas supplies o Expand storage capacities
o Need for new infrastructures Participate in infrastructure projects
o Globalisation of gas market through o Increase positions at all levels of
LNG the LNG chain
o Growing role of LNG as a means of o Global management of LNG resources
diversifying gas supplies
o Strengthen diversified production
o Strong demand for electricity mix: nuclear, renewables, thermal
worldwide o Targeted development outside Europe,
o Need for electricity production based on existing strongholds
capacities in Europe o Balanced positions between generation
o Challenges of sustainable development and supply
o New third-generation nuclear capacities
o Complete deregulation of the energy
market in Europe o New development opportunities
o Multi-energy offers
o Outsourcing and demand for energy
efficiency o Development of a global energy services
offer
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3 _____________________________________________
A value-creating transaction for all stakeholders
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A solid financial profile
2006 combined pro forma unaudited financial data -- In Euro bn(1)
SUEZ Gaz de France GDF SUEZ
Revenues 44.3 27.6 71.9
EBITDA(2) 6.2(3) 5.1 11.4
Current operating income 4.5 3.6 8.1
Net financial debt 10.4 3.5 13.9
Market capitalisation(4) 53.6 36.2 89.8
Significant financial flexibility that sustains the industrial strategy
of GDF SUEZ and enables to take advantage of external growth opportunities
(1) Based on the global integration of SUEZ's Environment activities
(2) Sum of SUEZ EBITDA adjusted for provisions for renewals, associates, financial charges
and Gaz de France EBITDA
(3) (euro)200m adjustment for renewal provisions
(4) Based on spot share price as of 31/08/07. Before taking into account the impact of
the distribution of 65% of SUEZ's Environment activities
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Confirmed potential for operational synergies of approximately (euro)1bn per
year in the medium term
Pre-tax annual impact post
impact of remedies
Annual total
2008-2010 2013
Gas sourcing euro100m euro180m
Scale effect Other procurement euro120m euro120m
Operating costs euro90m
--------------------------------------------- euro320m
Operating costs euro80m
Operational
synergies Complementarity Revenue synergies euro350m
---------------------------------------------
TOTAL euro390 euro970
Financial and tax optimisation ~ (euro)1bn
* Non-recurring implementation costs: (euro)150m for short term synergies
and (euro)150m for medium term synergies
(1) Short term synergies partially non-recurring
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Enhanced potential to create value and prospects for an attractive return for shareholders
o Stronger appeal for the GDF SUEZ stock
. Reinforced strategic positioning
. Enhanced growth and profitability profile
. Significant potential for synergies
o Dynamic dividend policy with the goal of an above sector average yield
o Potential for additional return for the shareholders
. Extraordinary dividend
. Share buyback program
o Re-rating potential of the GDF SUEZ stock
. Dynamic dividend policy _ Greater liquidity for the stock
. Increased weighting of GDF SUEZ in indices
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4 ----------------------------------------------------------
Well-balanced and fair merger terms
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Fair merger terms
o Proposed merger based on an exchange ratio of 21 Gaz de France for 22 SUEZ shares
o Simultaneous distribution to SUEZ shareholders of 65% of SUEZ's Environment activities
o The boards of directors of SUEZ and Gaz de France, on 2 september 2007,
mandated their chairmen to implement the new outline of the merger project
o The boards of directors have been provided with an opinion on the fairness
of the proposed exchange ratio
o Terms of merger will be approved by the body of 3 Commissaires a la fusion
appointed by the Commercial Court of Paris
o Terms will be submitted the Extraordinary General Meetings of both Groups to vote on
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A merger of equals
o Shareholders of the new entity
. 55%* of former SUEZ shareholders
. 45%* of former Gaz de France shareholders
o The French state, largest shareholder of the new Group
. Shareholding of more than 35%* of the new Group
Pro forma shareholding structure*
* On a non diluted basis
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Indicative timetable and next steps
Indicative timetable for the transaction
Extraordinary General Meetings of SUEZ and Gaz de France to approve the merger
Merger completion and simultaneous IPO of the Environment Business
Steps already completed
Approval of the proposed merger by the Belgian government October 6, 2006 Vote
by the French Parliament on the privatisation law of Gaz de France November 8,
2006 Authorisation of the transaction by the European Commission November 14,
2006
Decision of the Conseil Constitutionnel authorizing the privatisation of Gaz de
France starting July 1, 2007 November 30, 2006 Promulgation of the Gaz de France
privatisation law December 7, 2006 Request submitted to the European Commission
to delay the implementation of the remedies August 30, 2007
Next steps before completion of the merger
Opinion of employee representative bodies of SUEZ, Gaz de France,
and SUEZ Environment
Registration by stock market authorities of the merger documentation and the
documentation related to the IPO of the Environment business of SUEZ
The merger is expected to be completed as early as possible in 2008
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Floatation of SUEZ's Environment business,
one of the world leader in water
and waste services
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A stable shareholding of GDF SUEZ
Post-transaction shareholding structure of
SUEZ's Environment business
Free float 52%
Main SUEZ shareholders 12%
GDF SUEZ 35%
Shareholders' agreement 47%
Stable shareholding of 35%
Execution of a shareholders' agreement covering 47% of the capital of GDF SUEZ
Stable shareholding structure
Employment guarantees
Corporate governance
Current management of the Environnement
business of SUEZ to remain in place
Full consolidation in GDF SUEZ accounts
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SUEZ's Environment business, attractive growth prospects
Attractive growth opportunities in favorable market conditions
Growing demand for environmental solutions in context of climate change
(water resources management, waste recycling...)
Increasingly stringent environmental norms
Strong demand for cutting edge value added solutions
Water: desalination, sludge treatment, leakage reduction
Waste: metals recycling, mechanical biological treatment...
Acceleration of development sustained by global leadership position
Strong sales force supported by historical partnership approach
Ability to acquire and integrate profitable external growth opportunities
2010e EBITDA target at = (euro)3bn
(+ 50% vs. 2006)
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A business organisation geared towards efficiency and action
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Management structure
A management committee with 6 members
Chairman and chief executive officer Gerard Mestrallet
Vice chairman and president Jean-Francois Cirelli
Executive vice presidents Yves Colliou
Jean-Marie Dauger
Jean-Pierre Hansen
Gerard Lamarche
An executive committee
The members of the management committee
The operational directors and the support functions directors
A balanced management structure
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Organisational structure of the new Group
Chairman and chief executive officer - Gerard Mestrallet
Vice chairman and president - Jean-Francois Cirelli
Energy Policy Committee
Energy France Henri Ducre
Energy Europe & International Jean-Pierre Hansen
Global Gas & LNG Jean-Marie Dauger
Infrastructures Yves Colliou
Energy Services Jerome Tolot
Environment Jean-Louis Chaussade
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Creation of a global leader in Energy
An ambitious industrial project, stregthened by the swift changes in the sector
A truly European project benefiting all stakeholders
For our customers: through high-performances, innovative, and competitive offers
For our employees: a unifying project that will create jobs over time
For our shareholders: a value-creative project
An agreement on the new outline of the merger project
Fair financial terms and conditions for both shareholder groups
Transparent governance in line with best practices
A Group ready to move as soon as the merger is completed
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Commitments to the European Commission (remedies)
Undertakings to divest/retain
Sale of stake held in Distrigaz. The new Group will have a maximum of 70 TWh
supplied by long-term contracts held by Distrigaz
Holding in Fluxys SA (owner of regulated infrastructures in Belgium) to be
reduced to 45% and strenghtening of management autonomy. Interest in Fluxys LNG
(owner of the Zeebrugge terminal, assets outside Belgium (BBL) and non-regulated
Belgian assets (Huberator)) to be increased from 51 to 60%
Sale of Gaz de France stake in SPE (25.5%) through a 50% stake in Segebel
Disposal of Distrigaz & Co to Fluxys
Transfer of the Gaz de France stake in Segeo to Fluxys (25%)
Sale of Cofathec Coriance (except for district cooling networks) and the heating
networks of Cofathec Services
Other commitments
Infrastructures in Belgium
o Restructuring of Fluxys s.a., which owns the regulated infrastructures, and
strenghtened governance
o Expansion of the capacity of the Zeebrugge terminal owned by Fluxys
International
o Measures to facilitate access to the network
Infrastructure in France
o LNG terminal management business into subsidiaries to become a subsidiary
o Marketing of capacities on new underground storages and new capacities at
the Montoir LNG terminal
o Measures to facilitate access to the network
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Energy France
Leveraging the leadership position in natural gas supply to: .. Develop
multi-energy offers on the existing portfolio of "retail" customers .. Supply
electricity to other customer segments, according to market conditions ..
Develop the complementaries between energy and services businesses .. Parallel
growth in power production
New CCGT power plants
Development in Renewable
Energies: wind, hydro and biomass
DK6 786 MW
Cogeneration (Elyo) 1,700 MW
Montoir
Advanced hydraulic (SHEM) 773 MW
Wind 62 MW end 2007
Nuclear (Chooz) 650 MW
Basic hydraulic (CNR) 2,937 MW
Nuclear (Tricastin) 460 MW
Fos 2 CCGT
Projects
Energy France
11 million customers
No. 1 natural gas supplier
No. 2 electricity producer and supplier (7GW:
CNR, SHEM,...)
A new leader in the multi-energy offer
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Energy Europe and International
Benelux - Germany
Increased generation capacities
Consolidation of leadership in retail in Belgium
Expansion in Germany and the Netherlands
Europe
Integration and development based on existing assets in Italy and Eastern Europe
Strenghtening of positions depending on changes in the regulatory framework and
the effective deregulation of the markets
International
Development based on existing strongholds: USA, Brazil, Thailand, Middle East
Business model focused on industrial customers and growth markets
Energy
Europe &
International
57 GW in installed capacity
No. 1 supplier of natural gas and electricity in Belgium
No. 1 in power generation in the Netherlands
9 million customers
No. 1 IPP in Brazil and Thailand
No. 3 supplier to tertiary and industrial sectors in the United States
GDF SUEZ sites
Priority given to expansion in Europe
and selected international growth
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Global Gas and LNG
Development of the E&P business
Increase in reserves
Achievement subject to market conditions
Diversification and competitiveness of the supply portfolio
Strenghtening of the portfolio of long-term contracts
Increased geographic diversification
Global optimisation of the portfolio
Interests in new transit projects (Nabucco and Medgaz)
Strengthening of our LNG international leadership
Participation in integrated projects (Production / Liquefaction / Transport /
Regasification)
Expanded international arbitrage capacities Diversified, global natural gas
resources Global Gas and LNG
16 LNG tankers
3 tankers under construction
Neptune LNG
Bahamas
Everett
Dahej
Kochi
Petronet GNL (India)
Zeebrugge Montoir
Fos
Isle of Grain
Huelva
Italy
Carthagene
Sabine Pass
Regasification terminals
Reserved capacities
Projects of regasification terminals
Global Gas and LNG
No. 1 gas buyer in Europe
685 Mboe in reserves
World leader in LNG
1,100 TWh in natural gas sales
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Infrastructures
Terminals
Commissioning of Fos Cavaou (8.25bcm beginning of 2008)
Expansion of capacities at Zeebrugge (4.5bcm in 2008) and Montoir (2.5bcm in
2011 and 4bcm in 2014)
Storage
Increase in capacities in France
Development of offers
Expansion in Europe based on existing positions
(Germany, Slovakia, Romania and the UK)
Transport and distribution
Development based on the natural gas market growth
Investments tied to needs for fluider exchanges (transport capacity, volumes
distributed) Development of infrastructures to support the growth in natural gas
markets
Infrastructures
No. 1 transport network in Europe
No. 1 distribution network in Europe
No. 2 gas storage operator in Europe
No. 2 LNG terminal operator in Europe
Storage site
GDF SUEZ regasification terminal
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Energy services
A global offer from design to operation
Unique European network
Complementary service and installation businesses
Complete multi-technology offer
Growth factors
Increased use of outsourcing
Stronger demand for
energy efficiency
Continued profitable development
Enhanced synergies
between services and energy businesses
Selective growth in other European markets to support the other divisions
Energy services
European leader in energy services
Unique European network
15 countries
1,000 sites
Rest of Europe
Rev. 2006
Strong growth potential in the field of energy efficiency
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Confirmation of the operational synergies program of approximately (euro)1
billion per year in the medium term
Size effect
Reduction in sourcing costs: enhanced buying position towards suppliers,
optimised sourcing portfolio, etc.
Economies of scale on non-energy purchases
Optimisation of operating costs: pooling of networks and services
Optimisation of resources and structures
Effect of complementary businesses
Enlarged commercial offer
Non-duplication of entry "tickets" (marketing costs and investments) to markets
Accelereted commercial development TYPE OF SYNERGIES DESCRIPTION
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SUEZ's Environment activities, a world co-leader in water and waste management
services
Breakdown of 2006 revenues of SUEZ's Environment activities
Waste Europe 43%
Water Europe 34%
International 14%
Degremont 9%
2006 revenues: (euro)11.4bn
Leading positions in environment services
65 millions inhabitants served in drinking water
44 millions inhabitants served and connected to sanitation services
47 millions waste services customers
A presence focused on Europe and selective strongholds internationally
Attractive growth prospects*
2006 EBITDA: (euro)2.0bn
2007e EBITDA: (euro)2.35bn**
2010e EBITDA = (euro)3.0bn***
* See also management accounts of SUEZ's Environment activities in appendix
** AGBAR fully consolidated for 9 months
*** AGBAR fully consolidated for 12 months
A world co-leader in environment services, with expertise in global
management of the water and waste cycles
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SUEZ's Environment activities
Leadership in the full water and waste cycle enhanced by:
Controlled and up to date expertise
Differentiating technologies
Capacity to offer integrated solutions
Ongoing research of innovative products and segments
Growth primarily targeted to developed countries
85% of revenues recorded in countries where the long-term investment is
protected by mature political and legal systems
Increasingly stringent regulation to promote economic growth that protects the
environment
High cost of raw materials and fossil fuels which encourage recycling
Selective international expansion with the development of new business models
Management contracts (e.g. Algiers)
Long-term capital partnerships (e.g. China)
Innovative financial arrangements in partnerships
(e.g. PFI)
Environment
Global leader in environmental services
65 million inhabitants supplied with water
47 million inhabitants benefit from waste services
Rev. 2006
Country / Geographic zone
Leadership built on a solid European base
Global and healthy growth
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SUEZ's Environment activities: increased visibility
SUEZ Environment business is on top form
Recognised expertise, knowhow in differenciating technologies
Increased commercial dynamism
Excellent operational and financial performance
Well-experienced management team
A dynamic development strategy
Development strategy through external growth and targeted acquisitions
Support from a stable shareholder base .. Direct access to the financial markets
Investment program of (euro)4.0bn to (euro)4.5bn over 2007/09 to be fully
self-financed
Maintain its development strategy through partnerships with the Energy
businesses
Creation of a world co-leader in environment services benefiting from
an attractive stock market positioning
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Simplified organisational chart of SUEZ's Environment activities as of December
31, 2006
SUEZ 100%
SUEZ Environnement
Degremont 99.5%
Lyonnaise des Eaux France 99.5% 100%
ONDEO Industrial Solutions 55%
Safege 60%
ONDEO North America 100%
Filiales internationales Eau
SITA France 100%
Filiales internationales Proprete
Societe de Controle de Management - SCM 45% 40%
United Water Inc. 100%
SITA FD 100%
Teris 100%
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