Engie

Engie
Société Anonyme
Traded as Euronext: ENGI
Industry Electric utility
Predecessor Gaz de France
Suez
Founded July 22, 2008 (2008-07-22)
Headquarters La Défense, Courbevoie, France
Key people
 Isabelle Kocher (CEO) Gérard Mestrallet (Chairman)
Products Natural gas production, sale and distribution, electricity generation and distribution, hydroelectricity, wind power, energy trading
Revenue Increase€69.9 billion (2015)
Profit €2.6 billion (2015)
Total assets €160.658 billion (end 2015)
Total equity €48.750 billion (end 2015)
Owner
Number of employees
 154,950 (average, 2015)
Website engie.com
GDF SUEZ head office

Engie (known as GDF Suez prior to April 2015[2]) is a French multinational electric utility company, headquartered in La Défense, Courbevoie, which operates in the fields of electricity generation and distribution, natural gas and renewable energy. The company is a component of the Euro Stoxx 50 stock market index.[3]

The company, formed on 22 July 2008 by the merger of Gaz de France and Suez, traces its origins to the Universal Suez Canal Company founded in 1858 to construct the Suez Canal. Since the merger in 2008, the French state holds approximately a third of the company.[4] It adopted the "Engie" name in April 2015 in order to emphasize the changing nature of its energy business and de-emphasize its historical role as a nationalized gas monopoly.[5]

The company holds a 35% stake in Suez Environnement, the water treatment and waste management company spun off from Suez at the time of the merger.[6] GDF Suez bought 70% of Britain's International Power in August 2010, creating the world's largest independent utility company.[7][8] The purchase of the remaining 30% was announced by GDF Suez in April 2012, and the transaction completed in July 2012.[9][10] On July 1 2015, the company announced the acquisition of solar parks developer Solairedirect, which makes it the largest solar power electricity producer in France.[11]

As of 2015, Engie employs 154,950 people worldwide with revenues of €69.9 billion. Engie is listed on the Euronext exchanges in Paris and Brussels and is a constituent of the CAC 40 and BEL20 indices.

History

Background (before 2006)

Prior to the GDF Suez merger plans in 2006, the company existed as two separate French multinational corporations - Suez S.A. and Gaz de France, with a heritage tracing two centuries.

Suez was (and still remains, through GDF Suez as) one of the oldest continuously existing multinational corporations in the world as the result of nearly two centuries of reorganisation and corporate mergers. One line of corporate history dates back to the 1822 founded Algemeene Nederlandsche Maatschappij ter begunstiging van de volksvlijt (literally: General Dutch Company for the favouring of industry) by King William I of the Netherlands (see Société Générale de Belgique). The origin of its name 'Suez' traces back to its another founding entity – the Compagnie universelle du canal maritime de Suez founded in 1858 to build the Suez Canal. Suez S.A. was the result of a 1997 merger between the Compagnie de Suez and Lyonnaise des Eaux.

Gaz de France was created in 1946 along with its sister company Électricité de France (EDF) by the French Government. After the liberalisation of Europe’s energy markets, Gaz de France also entered into the electricity sector, having developed combined natural gas-electricity offerings. The company's capital was partially floated on the Paris Stock Exchange in July 2005, raising €2.5 billion for the French Government.[12]

Evolution of GDF Suez (2006 - 2008)

On 25 February 2006, French Prime minister Dominique de Villepin announced the merger of water supply and treatment, waste management and energy company Suez and power firm Gaz de France, with the aim of creating the world's largest liquefied natural gas company.[13] Since the French state owned over 80% of Gaz de France, it was necessary to pass a new law in order to make the merger possible. Whilst Nicolas Sarkozy was for several months opposed to the Villepin government’s plans for a merger of the two companies, preferring a three-way deal with Italy's Enel which would maintain a controlling stake for the state,[14] he subsequently accepted the government proposal.[15]

The plan for a merger between Gaz de France and Suez came under fire from the whole of the political left,[16] which feared the loss of one of the last ways of preventing the price rises experienced over the previous three years, and by the social Gaullists and trade unions.[17][18] In August 2006, the left-wing opposition submitted a record-breaking 137,449 amendments to the proposed legislation. Under normal procedure, parliament would have been required to vote on the amendments, which would have taken 10 years.[19] The French Constitution does give the government options to bypass such a filibuster, but in the end these were not used.[20]

Law No. 2006-1537 of 7 December 2006 on the energy sector authorised the privatisation of Gaz de France. On 3 September 2007, Gaz de France and Suez announced agreed terms of merger, on the basis of an exchange of 21 Gaz de France shares for 22 Suez shares via the absorption of Suez by Gaz de France.[21] Various holdings of Gaz de France and Suez had to be divested in order to satisfy the concerns of the European Commissioner for Competition: GDF agreed to sell its approximate 25% stake in Belgian electricity producer SPE for €515 million. The stake was purchased by fellow SPE shareholder Centrica which exercised its right of first refusal,[22] blocking a previous agreement to sell the stake to Électricité de France.[23] Suez, meanwhile, was forced to reduce its shareholding in natural gas distributor Fluxys[24] and sell its Belgian gas supply subsidiary Distrigas to Eni.[25]

GDF Suez (2008 - 2015)

The newly created GDF Suez came into existence on 22 July 2008; the world's second-largest utility with over €74 billion in annual revenues.[26] The deal resulted in the conversion of the French state's 80% stake in GDF into just over 35% of shares of the new company. The water and waste assets which formerly formed part of Suez were spun off into a new publicly traded company, Suez Environment, in which GDF Suez retains a stake.

In 1975, Ruhrgas and Gaz de France concluded a deal according to which they agreed not to sell gas in each other's home market. The deal was abandoned in 2005.[27]

In July 2009, the European Commission fined GDF Suez and E.ON €553 million both over arrangements on the MEGAL pipeline.[27][28] It was the second biggest fines imposed by the European Commission and the first one on the energy sector.[27][29]

In October 2009, GDF Suez placed 6th in an A.T. Kearney/BusinessWeek ranking of the "World's Best Companies", the highest-placed European firm.[30]

On 10 August 2010, the company announced a merger of its GDF SUEZ Energy International business unit, along with its operations within the United Kingdom and Turkey, with International Power. The acquisition created the world’s biggest independent power producer, and the enlarged company will retain International Power's listing on the London Stock Exchange and be 70% owned by GDF Suez.[7][8][31]

In December 2010, GDF SUEZ became the key founding member of the 'Medgrid' company[32] - a consortium of twenty plus utilities, grid operators, equipment makers, financing institutions and investors; which will implement the 'Medgrid project', a French renewable energy initiative within the framework of the Union for the Mediterranean (UfM). The project, planned in North Africa, aims to promote and develop a Euro-Mediterranean electricity network of 20GW installed generating capacity, with 5GW being devoted for exports to Europe. The Medgrid together with the German initiated Desertec project[33] would serve as the backbone of the European Supergrid.[34][35]

On 16 April 2012, the purchase of the remaining 30% of International Power was announced by GDF Suez, and the transaction completed in July 2012.[9] GDF Suez was advised by Rothschild and Ondra Partners, while Barclays, Morgan Stanley and Nomura advised International Power.[9][10]

On 9 August 2013, GDF Suez, through its Energy Services business line, announced the purchase of Balfour Beatty’s UK Facilities Management business – Balfour Beatty WorkPlace. The legacy Cofely business incorporated the legacy Balfour Beatty Workplace Business which went on to aqquire Lend Lease FM in 2014 from Lend Lease Group giving the new business a substantial platform in the operation of PFI assets in the UK.

GDF Suez becomes Engie: 2015 - present

On April 24, 2015, GDF Suez announced it has changed its name to "Engie", in an effort to further expand the company's international footprint. CEO and Chairman Gérard Mestrallet said the new name was a symbol to meet the challenges of the energy transition and accelerate the group's development.[36]

In July 2015, Engie acquired 95% of Solairedirect, raising its photovoltaic production from 125 to 486 MW.

Operations

Key Figures

Electricity generation

France

Thanks to former Suez subsidiaries such as Compagnie Nationale du Rhône (CNR), Electrabel and Société Hydro Electrique du Midi (SHEM), GDF Suez is the second-largest generator of electricity in France[39] behind EDF.[40] The company indicated in December 2011 that ¾ of the group's production comes from sources that emit no CO2 principally hydroelectricity (through CNR and SHEM) and wind power, the latter of which both Gaz de France and Suez moved aggressively into in 2007 and 2008.[41] Recently acquired subsidiaries include La Compagnie du Vent (majority stake),[42] the wind farm business of Nass & Wind[43] and Erelia.[44] The company also operates a natural gas-fired combined cycle power plant (DK6) in Dunkirk. With the stated aim of reaching a total production capacity of 10 GW by 2013, three gas-fired thermal power plants at Fos-sur-Mer, Montoir-de-Bretagne and Saint-Brieuc are currently in various stages of development, as is a solar panel project in Curbans.[41]

International

The GDF Suez group also generates electricity in a number of countries outside France. Most notably, the company is the leading producer in both Belgium and the Netherlands through Electrabel[45] (and the fifth-largest generator in Europe overall),[46] as well as the largest non-state owned generator in both Brazil[47] and Thailand[48] (thanks to majority stakes in ENGIE Brasil and Glow Energy respectively). GDF Suez also holds a 50% stake in NuGeneration (NuGen), a company planning to build a new nuclear power station of up to 3.6 GW capacity at Sellafield in the United Kingdom.[49] The other 50% of NuGen is held by Iberdrola. The company also operates in North and Latin America through its Suez Energy International unit, as well as in other European and Asian countries. The company generates electricity through various types of plants, including thermal power, nuclear power, combined heat and power, wind farms, hydroelectric and biomass.[50] Engie is currently developing a $15.8 billion nuclear power plant in Sinop, Turkey in partnership with Itochu and Mitsubishi Heavy Industries.[51]

In November 2016, Engie signed an agreement with Moroccan energy company Nareva. The two companies are planning to develop energy assets in North and Western Africa that will produce 5,000 and 6,000 megawatts. The plans will take place between 2020 and 2025.[52]

Carbon intensity
Year Production (TWh) Emission (Gt CO2) kg CO2/MWh
2002 115 44.48 387
2003 130 41.59 320
2004 125 40.83 327
2005 123 39.36 319
2006 129 40.4 314
2007 148 50.52 341
2008 145 47.58 327
2009 141 45.44 322
Coal-fired power plants

In October 2015, Engie announced that it will no longer build coal-fired power plants. Gérard Mestrallet said projects for which Engie had already entered into firm commitments would be honored, but projects where contracts had not yet been signed will de facto be suspended. As a result, Engie abandoned two coal-fired power plants projects in Ada Yumurtalik (Turkey) and in Thabametsi (South Africa).[53] In February 2016, Engie announced the selling of its stakes in the Paiton power plant located in Indonesia and in the Meenakshi power plant located in India.[54] Engie also announced the closing of the Rugeley power station in England.[55]

In May 2016 Engie CEO Isabelle Kocher told a French Senate committee that it was planning a gradual withdrawal from coal-fired generation over the coming years. This could include closure of, or sale of its stake in, the lignite-fired Hazelwood power station in Victoria, Australia.[56]

Natural gas

Engie covers the whole gas chain, from exploration and production to distribution. It is the:

Energy services

Engie provides energetic efficiency and environmental services. 90,000 of the group's employees are dedicated to services.

Shareholder structure

As of 31 December 2015 [57]
  1. State of France (32.55%)[1]
  2. Groupe Bruxelles Lambert (2.33%)
  3. Caisse des dépôts et consignations (1.88%)
  4. CNP Assurances (1.77%)
  5. Sofina (0.37%)
  6. employees of the company (2.72%)
  7. free float (56.55%)
  8. treasury stock (1.62%)

Organisation

Business units

Since 2016, Engie is organised in 24 business units:[58]

Subsidiaries and holdings

Management

The Engie General Management:

Engie is administered by a Board of Directors of 19 members. The Board is backed by the recommendations of four specialized committees.

The members of the group executive committee are:[59]

As from 1 October 2016 they will be joined by Ana Busto who has been newly appointed as Senior Vice President, Brand and Communications of the Engie Group, reporting to Chief Executive Officer Isabelle Kocher.[60]

See also

References

  1. 1 2 "Les participations publiques" (in French). Agence des participations de l'État. 30 April 2015. Retrieved 21 February 2016.
  2. ↑ "GDF SUEZ becomes ENGIE - ENGIE".
  3. ↑ Frankfurt Stock Exchange
  4. ↑ "Shareholding structure". Engie. 22 July 2008. Retrieved 2016-06-03.
  5. ↑ "GDF Suez to change name to Engie". The Telegraph. Reuters. 24 April 2015. Retrieved 25 May 2015.
  6. ↑ Maitre, Marie (22 July 2008). "Suez Environnement gushes on Paris market debut". Reuters. Retrieved 22 July 2008.
  7. 1 2 "GDF takes control of International Power to form energy giant". Reuters. 10 August 2010. Retrieved 6 June 2012.
  8. 1 2 "GDF SUEZ Is Stepping On The Gas In Fast Growing Markets". Retrieved 6 June 2012.
  9. 1 2 3 Scott, Mark (16 April 2012). "GDF SUEZ to Buy Remaining Stake in British Utility for $10 Billion". The New York Times. Retrieved 6 June 2012.
  10. 1 2 Turner, Matt (30 March 2012). "Independent advisers win out on GDF Suez deal".
  11. ↑ Engie buys Solairedirect for 222 million in renewables pushBloomberg. July 1, 2015
  12. ↑ Moya, Elena (8 July 2008). "Gaz de France Shares Jump After Public Offering". Bloomberg. Retrieved 12 July 2008.
  13. ↑ "Dominique de Villepin a annoncé un projet de fusion entre Gaz de France et Suez". Le Monde (in French). 25 February 2006. Retrieved 12 July 2008.
  14. ↑ Gow, David (15 June 2006). "EU to investigate Suez-Gaz de France deal". The Guardian. London. Retrieved 22 July 2008.
  15. ↑ "Nicolas Sarkozy réaffirme son "accord" au projet de fusion GDF-Suez". Associated Press (in French). Le Nouvel Observateur. 15 August 2006. Retrieved 22 July 2008.
  16. ↑ Maitre, Marie (2 September 2007). "France launches new GDF-Suez utility merger plan". Reuters. Retrieved 22 July 2008.
  17. ↑ "French court puts brakes on merger of Gaz de France and Suez". Bloomberg, Associated Press. International Herald Tribune. 22 January 2008. Retrieved 22 July 2008.
  18. ↑ Hotten, Russell (4 September 2007). "Suez and Gaz de France in £47bn merger". The Daily Telegraph. London. Retrieved 22 July 2008.
  19. ↑ "TIMELINE: Key dates in Gaz de France-Suez merger". Reuters. 2 September 2007. Retrieved 24 February 2010.
  20. ↑ Kanter, James (19 September 2006). "Plan for Gaz de France advances toward a vote". International Herald Tribune. Retrieved 24 February 2010.
  21. ↑ "Suez, Gaz De France Agree To New Merger Deal". RTT News. 2007-09-04. Retrieved 4 September 2007.
  22. ↑ Shelley, Toby (23 July 2008). "Centrica takes control of Belgium's SPE". Financial Times. Retrieved 23 July 2008.
  23. ↑ Maitre, Marie (20 June 2008). "GDF agrees to sell SPE stake to EDF for $800 mln". Reuters. Retrieved 22 July 2008.
  24. ↑ "Suez sells 12.5 pct stake in Fluxys to UK fund Ecofin Ltd for 228 mln euros". AFX News. Forbes. 4 July 2008. Archived from the original on 2011-06-04. Retrieved 22 July 2008.
  25. ↑ "Key moments in GDF SUEZ combination". The Boston Globe; Associated Press. 16 July 2008. Retrieved 10 October 2010.
  26. ↑ Vidalon, Dominique (1 July 2008). "Suez shares to exit French CAC-40 July 22". Reuters. Retrieved 12 July 2008.
  27. 1 2 3 Nikki Tait (2009-07-08). "Brussels fines GDF and Eon €1.1bn". Financial Times. Retrieved 8 July 2009.
  28. ↑ Charles Forelle (9 July 2009). "EU Slaps $1.53 Billion Fine on Natural-Gas Cartel". The Wall Street Journal. Retrieved 10 October 2010.
  29. ↑ Ian Traynor (2009-07-08). "Brussels levies €1.1bn fine on gas pact pair". London: The Guardian. Retrieved 8 July 2009.
  30. 1 2 Deprez, Esmé (1 October 2009). "World's Best Companies 2009". BusinessWeek. Retrieved 18 October 2009.
  31. ↑ Lundgren, Kari (10 August 2010). "GDF Buys International Power, Pays Special Dividend". Bloomberg. Retrieved 10 August 2010.
  32. ↑ "Secretary General Ahmad Masa'deh expects the MEDGRID project to positively impact climate change". ufmsecretariat.org. 9 December 2010. Retrieved 27 November 2011.
  33. ↑ "Huge medgrid joins giant solar desertec plan". greenprophet.com. 24 November 2011. Retrieved 27 November 2011.
  34. ↑ "Desertec and Medgrid: Competitive or compatible?". social.csptoday.com. 11 March 2011. Retrieved 27 November 2011.
  35. ↑ "Survey paper 2: A European Supergrid: Present State and Future Challenges Authors: S. Cole, K. Karoui, T.K. Vrana, O.B. Fosso, J.B. Curis, A.M. Denis, C.C. Liu" (PDF). pscc-central.org. 22 August 2011. Retrieved 27 November 2011.
  36. ↑ "GDF Suez announces corporate rebranding, becomes ENGIE". Hydroworld.com. 5 May 2015.
  37. ↑ "The World's Biggest Public Companies". Forbes. Retrieved 2016-05-24.
  38. ↑ "Best Global Brands | Brand Profiles & Valuations of the World's Top Brands". brandirectory.com. Brand Finance. Retrieved 2016-05-24.
  39. ↑ "GDF SUEZ shares fall in stock market debut as merger hype wanes". Associated Press. International Herald Tribune. 22 July 2008. Retrieved 27 July 2008.
  40. ↑ "EdF is by far the largest electricity generator in France.." "Commission opens in-depth investigation into the joint control of EnBW by EDF and OEW" (Press release). European Commission. 3 October 2000. Retrieved 27 July 2008.
  41. 1 2 "Energy France". GDF Suez. Archived from the original on 2011-12-27. Retrieved 10 October 2010.
  42. ↑ "Suez buys 50.1 pct of Cie du Vent for 321 mln eur; to raise stake to 56.8". AFX News. Forbes. 16 November 2007. Archived from the original on 2011-06-04. Retrieved 27 July 2008.
  43. ↑ "GDF buys Nass and Wind unit; to create renewable energy division". AFX News. Forbes. 6 March 2008. Archived from the original on 2008-03-13. Retrieved 27 July 2008.
  44. ↑ "Gaz de France buys 95 percent of French wind power company Erelia". Associated Press. International Herald Tribune. 9 October 2007. Retrieved 27 July 2008.
  45. ↑ "France proposes 'patriotic' merger for utilities". International Herald Tribune. 26 February 2006. Retrieved 27 July 2008.
  46. ↑ Mitchell, Adam (16 July 2008). "Suez CEO: GDF-Suez "Clearly" In Private Sector". Dow Jones Newswires. EasyBourse. Retrieved 27 July 2008.
  47. ↑ Ragir, Alexander; Freebairn, William (20 May 2008). "America Movil, Aracruz, OHL Brasil, Vale: Latin Equity Preview". Bloomberg. Retrieved 27 July 2008.
  48. ↑ Hampton, Stuart. "Glow Energy Public Company Limited". Hoover's. Retrieved 27 July 2008.
  49. ↑ "About Nugen". NuGeneration.
  50. ↑ "Electricity production". GDF Suez. Retrieved 10 October 2010.
  51. ↑ "2 Japanese companies aim to fund 30% of Turkish nuclear project". Nikkei Asian Review. Nikkei. 8 June 2015. Retrieved 9 June 2015.
  52. ↑ "Engie signs deal with Morocco's Nareva to expand in Africa".
  53. ↑ "Why the ENGIE Group will embark on no new coal-fired power plant projects". Engie. 14 October 2015. Retrieved 2016-06-03.
  54. ↑ "Major step in ENGIE's transformation to reach its ambition to be leader of the world energy transition". Engie. 25 February 2016. Retrieved 2016-06-03.
  55. ↑ "Rugeley power station will close in June, ENGIE confirms". Engie. 23 May 2016. Retrieved 2016-06-03.
  56. ↑ "UPDATE 1-Engie mulls closing Australia's Hazelwood coal-fired power plant". Reuters. 2016-05-25. Retrieved 2016-07-09.
  57. ↑ "2015 Registration Document". Engie. 31 December 2015.
  58. ↑ "A new organizational structure for Engie". Engie press release. 1 Jan 2016.
  59. ↑ "ENGIE: a new executive management team". Engie press release. Retrieved 4 May 2016.
  60. ↑ 4-traders. "Engie : Ana Busto is appointed ENGIE Senior Vice President, Brand… - 4-Traders".

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