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EU OKs Veolia, Butler Capital To Buy SNCM
The European Commission Tuesday cleared Veolia Environnement's (VE) transport division and French investment fund Butler Capital Partners to buy joint control of ferry operator Societe Nationale maritime Corse Mediterranee.
SNCM is a ferry operator that provides sea links between Corsica and mainland France. Its fate has become a major political issue in France.
The French government last year orchestrated a rescue package under which the state injected EUR142.5 million in aid and cut its interest in the company to 25%. SNCM workers responded by going on strike for three weeks, saying they wanted the company to remain majority state-owned.
As part of the rescue plan, French financier Walter Butler acquired a 38% stake, while Veolia bought a 28% interest and become operator of SNCM's fleet.
On May 3, more than three quarters of the company's employees voted in favor of the partial privatization.
The takeover was cleared under the commission's simplified procedure. This clears deals automatically after one month if no third party complains.
While the deal posed few antitrust problems - it actually keeps alive competition on the ferry route - the amount of state involvement in the bailout remains under investigation. The French government last month sent European regulators its plan for the restructuring of the ferry. Under E.U. rules against state bailouts, the government must show that private investors would have acted in the same way in making an investment.
SNCM is a ferry operator that provides sea links between Corsica and mainland France. Its fate has become a major political issue in France.
The French government last year orchestrated a rescue package under which the state injected EUR142.5 million in aid and cut its interest in the company to 25%. SNCM workers responded by going on strike for three weeks, saying they wanted the company to remain majority state-owned.
As part of the rescue plan, French financier Walter Butler acquired a 38% stake, while Veolia bought a 28% interest and become operator of SNCM's fleet.
On May 3, more than three quarters of the company's employees voted in favor of the partial privatization.
The takeover was cleared under the commission's simplified procedure. This clears deals automatically after one month if no third party complains.
While the deal posed few antitrust problems - it actually keeps alive competition on the ferry route - the amount of state involvement in the bailout remains under investigation. The French government last month sent European regulators its plan for the restructuring of the ferry. Under E.U. rules against state bailouts, the government must show that private investors would have acted in the same way in making an investment.
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