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28 January, 2008
A French court on 22 January ruled that before an amended merger plan between Gaz de France and Suez can go to shareholders, trade unions and the Works Council must be given more information in order to shape their views on the merger.
The decision by the Tribunal de Grande Instance in Paris comes in a case filed by Gaz de France in December on the Works Council for its inability to come to a definitive opinion, prior to Works Council members’ terms ending on 31 December.
The company was seeking a court order mandating an opinion from the workers’ body, but what was delivered was another costly delay to an ill-advised merger.
Under French law, the Works Council had to submit a non-binding opinion on an amended merger plan that was submitted in September 2007. But workers’ representatives did not have needed information on a plan to spin-off the water and environmental businesses of Suez.
The merger of the state-run French utility with Franco-Belgian Suez Group was initially proposed early in 2006. It has been held up in the courts at several points.
French unions and workers’ representatives have resisted the merger because it essentially privatises Gaz de France. The company is 80% state held, and a merger would reduce France’s stake in the combined company, to be called GDF Suez, to 35%. French trade unions CGT, CFDT, FO, CGF-CGC, and CFTC have united to resist further consolidation of Europe’s energy markets.
A new consultation committee of the Works Council is expected to be in place by mid-February to examine further information by the companies regarding the merger.