France’s major oil and gas company Total SA has entered into an agreement with the controlling shareholders of Direct Energie for the proposed acquisition of 74.33% of its share capital, at a price of EUR 42 (USD 52) per share, representing an aggregate acquisition price of approximately EUR 1.4 billion (USD 1.73 billion).
“Through this transaction, Total is actively pursuing its development in electricity and gas generation and distribution in France and Belgium. This friendly takeover is part of the Group’s strategy to expand along the entire gas-electricity value chain and to develop low-carbon energies, in line with our ambition to become the responsible energy major,” said Patrick Pouyanné, chairman and CEO of Total.
“We welcome this transaction with pride and enthusiasm and we are convinced that combining with Total will be to the benefit of our customers,” said Xavier Caïtucoli, chairman and CEO of Direct Energie. “The Direct Energie teams will be at the heart of the strategy of one of the greatest French companies. I have no doubt that their hard work, creativity and talents will allow the new entity to expand its ambitions.”
In the field of natural gas and electricity distribution to both consumers and professionals, Total is firmly establishing itself as a leading alternative supplier by combining its 1.5 million client portfolio with Direct Energie’s 2.6 million client portfolio. This combination will enable Total to pursue its ambitious development program to become a standard-setting player in electricity supply in France and Belgium, targeting more than six million customers in France and more than one million customers in Belgium by 2022.
Once this acquisition has been completed, Total will file with the French Financial Market Authority (Autorité des marchés financiers) a mandatory tender offer on the securities of Direct Energie which are traded on Euronext Paris at the same price per share of EUR 42 (USD 52), which represents a 30% premium above Direct Energie’s closing share price on April 17, 2018 and a 24% premium above the volume weighted average share price over the past three months and 13% above the volume weighted average share price over the past six months.
The offer thereby values Direct Energie at approximately 12.5 times its 2018 projected EBITDA.