These are the main findings of the study :

On top of the direct price tag of the takeover, which added €9bn to Veolia’s debt, the Veolia- Suez merger/spin-off resulted in hundreds of millions of euros and possibly over a billion euros in extra costs, which went to bankers, corporate lawyers, consultants and lobbyists.

The Veolia-Suez deal, that comes after several controversial mega-mergers of a similar kind in recent years, is yet another illustration of the close relations between public authorities and big business in France, which results in widespread conflicts of interests and a permanent confusion between public and private goals. President Macron and key government figures effectively pushed for the deal, which benefitted political allies. French public financial institution Caisse des dépôts et consignations is now a major shareholder of both Veolia and Suez.

Veolia’s core business model remains what it has always been historically: a rentier business based on the capture of public funds dedicated to essential services. It is progressively shifting from being centred on the capture of the “water rent” to the capture of a new “climate rent”, targeting all the recent major investment and recovery plans aimed at accelerating the climate transition.

One of the drivers of the Suez deal was Veolia’s strategy to capture the narrative about the future of water and waste services and about the climate crisis, and push the case that technological solutions are the only way to address ecological crises and that the price of water, waste and other essential services need to increase drastically to meet these challenges. It is a strategy of “privatisation through technology”.

The Veolia-Suez deal also represents a new step in the financialisation of water and waste services, with investment funds and private equity playing a larger role in running the services and extracting profits from them.

By acquiring large parts of the “old Suez”, especially the US assets, Veolia has become a quasi monopoly with reinforced market power vis-à-vis local authorities and industrial clients, which it is bound to use to increase prices. Competition authorities gave their approval to the deal by taking a narrow view of its consequences.

Veolia recently announced record profits for 2022, but this has nothing to do with the Suez deal. The growth in profits and revenues is due to the increase in water, waste and energy prices, and most of it comes from Veolia’s heating contracts in Central and Eastern Europe countries. In other words, these are windfall profits from the war in Ukraine, similar to those recorded by oil and energy giants, at the expense of people facing skyrocketing bills for essential services.

While there is still a lot of uncertainty about potential job cuts within both companies, in spite of their pledge not to suppress jobs for several years, one thing is certain: workers will continue to bear the brunt of “synergies” and other cost-cutting measures. Wages have not increased as much as inflation, while water prices and dividends have.

Read the full study.

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