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Suez plans telecom binge
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January 28, 2000: 5:58 a.m. ET
French utility giant eyes cellular, local loop expansion; shares surge 8%
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LONDON (CNNfn) - Suez Lyonnaise des Eaux, the diversified French utility, said Friday it plans to expand its telecom business, sparking an 8 percent jump in its share price.
The company aims to bid for a new-generation mobile phone license, develop a wireless local loop operation and bolster its TV interests.
Suez operates international power and waste management businesses, but while it has a small cable unit, the company has trailed rival Vivendi in building up its telecom assets.
Suez failed to secure a cellular license in the last round of auctions in the early 1990s, but chairman Gérard Mestrallet said in an interview that it would form a consortium to bid for one of two next-generation licenses being offered later this year. The so-called UMTS technology allows users to access data and email via their mobile phones. Suez said It will present it formal license bid Monday, although it didn't disclose the identity of any partners in the bid.
Mestrallet also told Les Echos newspaper that the company would form a consortium to develop local loop services in 100 French towns, linking homes and businesses to the domestic telecom backbone. France Telecom currently has a monopoly on these local loop services.
Suez (PLY) shares climbed to 150.60 euros in Paris. The stock has fallen 20 percent over the past year, cutting its market value to 30 billion euros ($29.6 billion). Shares in Vivendi (PEX) have soared on the expansion of its telecom and media interests, including stakes in pay-TV operators Canal Plus (PCAN) and BSkyB (BSY).
Suez has hitherto focused on becoming a global utility, investing more than $9 billion in acquisitions in Europe, Asia and North America. 
-- from staff and wire reports
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