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News > International
Vivendi, EdF tie power arms
June 22, 2000: 6:39 a.m. ET

French media and utility firm to combine power-services business
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LONDON (CNNfn) - French utility and media firm Vivendi announced plans Thursday to merge its energy-services business with that of state-owned Electricité de France (EdF), the world's largest electricity company.

The companies plan to create a new entity, dubbed Dalkia Holding, combining their power-sector maintenance and engineering units in a business with pro forma revenue of 3.6 billion ($3.4 billion) in 2000.

The signing of the memorandum of understanding continues the hectic pace of deal-making at Vivendi, which agreed Tuesday to acquire Canadian entertainment and drinks firm The Seagram Co (VO: Research, Estimates). And the remaining shares in its own pay-TV affiliate Canal Plus (PAN) in a $51.5 billion deal to create the world's No. 2 media firm.

For EdF, the tie-up will help it to meet the timetable for liberalization of Europe's energy market. This will bar the French monopoly from offering maintenance services to its captive customers.

graphicVivendi would own 66 percent of Dalkia Holding, with EdF retaining the balance. Dalkia will in turn control an international arm, split equally between the two partners, and a larger domestic business, owned 34 percent by EdF and 66 percent by Vivendi. To satisfy regulators, the accord include a clause that means EdF will have no management control over the domestic business.

Vivendi (PEX) shares were more than 4 percent higher at 93.15 in Paris Wednesday. Back to top

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