Suez was a multinational corporation based in France that ran water, waste management, energy and, for a short time, telecommunications projects around the world. In 2008, it merged with the French company Gaz de France to create GDF Suez, a utility company. The waste treatment and water components of the former company were rolled into a new multinational corporation called Suez Environnement.
History of the Corporation
The long and complex history of this company began in the Netherlands in 1822 and included mergers and breakups with several companies. The name Suez came from its participation with the building of the Suez Canal in the mid-1800s. After joining the company in 1984 as vice president, Gérard Mestrallet rose to become its chairman and chief executive officer (CEO) in 2001. He held this position when the merger with Gaz de France took place, then became the CEO of Suez Environnement.
Controversial Merger
There was considerable controversy in France over the merger of these two companies, because the state previously had a governing share of ownership of Gaz de France. When the plan was first announced in February 2006, French Prime Minister Dominique de Villepin and President Nicolas Sarkozy were at odds over the merger, with Villepin supporting it and Sarkozy promoting a deal that would allow France to maintain its controlling share. As Villepin and Sarkozy reached an agreement to let the deal proceed, leftist opposition throughout the country continued to raise objections over the privatization of Gaz de France because of a fear price increases. Plans went on in spite of the criticism, however, and French laws and Gaz de France shares were restructured to allow the deal to take place. On 22 July 2008, the two companies officially merged to form GDF Suez, which became the world's second-largest utility company.
The water and waste divisions of the former company became Suez Environnement, of which GDF Suez owns a substantial share. These divisions had their beginnings with La Société Lyonnaise des Eaux et de l'Eclairage, which managed the water supply in Cannes, France, beginning in 1880. Operations have evolved to include catchment, treatment and distribution of drinking water; purification of industrial water; and the collection, treatment, recycling, energy recovery, incineration and landfill depositing of waste. Suez Environnement has several subsidiaries, including United Water, Ondeo, Degrémont, Sita and Safege.
Answering Critics
As one of the largest water companies in the world, Suez has come under fire from critics of water privatization worldwide. The company has suffered several public relations injuries because of water privatization debacles, notably a corruption scandal in Grenoble, France; the loss of its contract with Atlanta, Georgia, in the United States; and contract renegotiations in the Philippines. Anti-privatization activists and non-governmental organizations such as Food and Water Watch have claimed that the company has exploited the poor, has over-billed its customers and has not delivered on some of its contractual obligations. Suez maintains that it has upheld its contracts, has improved water accessibility and quality in its contracted areas and has had far more success than failure with its water contracts.