PARIS—France’s Veolia Environnement SA reached a $15.5 billion deal to acquire Suez SA, creating a water and waste-management giant that aims to soak up a global surge in infrastructure and climate-change spending.
The companies turned the page on months of acrimony and legal battles Monday, striking a preliminary agreement for Veolia to purchase Suez shares for 20.50 euros apiece, compared with an initial offer of €15.50. The combined entity would generate annual revenue of €37 billion, equivalent to $44 billion, across five continents.
The deal comes at a time when governments world-wide are boosting spending on infrastructure as part of efforts to recover from the pandemic and overhaul their economies to meet commitments under the Paris climate accord.
President Biden this month unveiled a $1.52 trillion budget outline focused on climate change and infrastructure. The European Union in July last year agreed on a €750 billion recovery fund designed to spark an industrial transformation centered on a European Green Deal.
Water and waste-management services are grappling with a transition to greener technologies that will require an overhaul in the operations of local services ranging from trash collection and water treatment to recycling and the production of energy from industrial waste. Veolia estimates this transition will create a global market of nearly €1 trillion.