French water and waste group veolia has upped its offer for the stake in its rival suez held by energy group engie as a crunch decision looms in the embittered takeover attempt.
Veolia increased its original 15.50 a share offer to 18 for 29.9 per cent of suez held by engie, increasing the value of the offer from 2.9bn to 3.4bn.
While it is trying to make the deal more palatable to suez it has held to wednesdays deadline, saying the offer will expire at midnight.
Suez shares jumped 7 per cent to 15.91 in early morning trade in paris.
The refusal to budge on a deadline has increased pressure on engie chairman jean-pierre clamadieu, whose board must decide this evening whether to accept veolias offer or risk giving suez more time to put together a rival bid. mr clamadieu has described the decision as a very heavy responsibility.
Veolia first made its offer public at the end of august, saying it would snap up the rest of suez once the first block was bought.
The french state, which is engies largest shareholder, held talks between veolia and suez on tuesday night, which failed to reach an agreement, while finance minister bruno le maire has said that any deal should not be hostile.
Engie, which is also searching for a new chief executive, has agitated for a higher price and invited suez to put its own offer on the table. suez has yet to do so and has said it needs more time.
Veolia said on wednesday morning that it will only launch a tender offer on the 70.1 per cent of the capital of suez provided it is on a friendly basis and that a favourable recommendation from the suez board would be sought over a period of six months.
The quid pro quo for the offer to find a compromise, said veolia, is that suez should immediately remove the mechanism announced on september 23, which involved putting its french water business in a protected foundation, in a poison-pill move aimed at generating leverage.
Veolia chief executive antoine frrot said, however, that he would not rule out a hostile bid, even if it was not the preferred option.
The water business has been central to veolias takeover approach. in an effort to pre-empt competition issues, veolia had agreed to sell suezs french water business to meridiam, a french fund, guaranteeing jobs.
Suez, whose chief executive bertrand camus has called the takeover attempt by veolia particularly hostile, has said the fund is not equipped to manage a water business.
Mr frrot has lashed out at what he sees as scorched earth tactics from suez as it sells off assets as part of an acceleration of its strategic plan aimed, it says, at demonstrating its value as a standalone business.