Suez and Veolia, more than a century of rivalry



• The General Water Company (CGE), which became Vivendi in 1998 and Veolia in 2003, was created in 1853 by an imperial decree from Napoleon III. The same year, it goes public and signs a water distribution agreement with the City of Lyon, for a period of fifty years. It is the first water concession contract in the world.

• The Lyonnaise des eaux et declairage was created in 1880 by Crédit Lyonnais. The company is also increasing its contracts with local authorities in water management, but also in the distribution of gas and electricity, where it quickly became the number one in France at the turn of the century. In 1997, it merged with one of its shareholders, the Suez Financial Company, heir to the Universal Suez Canal Maritime Company, founded in 1855.

• In more than 150 years of existence, the “Lyonnaise” and the “Générale”, as they have been called for a long time, have had quite similar backgrounds and share the same corporate cultures, even if Suez points out differences, which would be historically linked to the company’s status as a “challenger”.

• At the end of the 1990s, the two groups increased their acquisitions to strengthen their businesses and accelerate their international development. It was the era of giant water distribution contracts in the major capitals of Asia and Latin America. In Eastern Europe, they weave their web after the fall of the communist regimes, where the networks are in poor condition.

• This rapid expansion abroad was a way of offsetting lower growth in activity in France. The beginning of the 1990s was indeed marked by several corruption scandals, such as the Carignon affair, named after the mayor of Grenoble condemned for having received money from the Lyonnaise in exchange for the award of the market. ‘water. Leaders of the General of Waters must also explain themselves before the judges on hidden payments.

• This is the end of old-fashioned contracts, signed over several decades with local communities, often in a rather opaque manner. New laws are passed. They prohibit the financing of political life and severely limit the duration of contracts.

• Many times, one of the companies will try to eat the other, taking advantage of its weak position. In 2002, Suez and Vinci thus considered taking over the “Générale”, which became Vivendi Environnement. In 2006, it was Veolia’s turn to take action with the Italian Enel, but French President Jacques Chirac vetoed it. Suez will then precipitate its merger with Gaz de France to take shelter. In 2012, the two water giants again discuss a rapprochement, in a friendly manner this time, but quickly give up.

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