Gas de France Suez merger - GdF unions given negative opinion

The central works council of Gas de France gave its negative opinion on the merger of Gas de France with Suez. Although the opinion is obligatory to obtain for the company in France, it is not binding. Both companies now have the opinion of the workers' representative bodies (both at European level and at French level) and will now proceed rapidly with the merger. The Boards will meet, sign the merger agreement and general shareholders meetings are foreseen for Mid July. And then a new company will be created after a long battle with the trade unions.

It has resulted in a noteworthy legal case in which the EWC of GdF obtained a ground breaking rule that management has to inform (and provide all relevant information) before decisions are taken, allowing time to the EWC to form its opinion.

Trade unions in Suez reached a number of social guarantees, including no forced redundancies and a social clause in commercial contracts.

Gas de France will be privatised with the state only keeping roughly a third of the shares. Both companies will have to disinvest from some activities. Currently in the news is the sale of Suez of the gas company Distrigas in Belgium, probably to Italian company ENI (and which in turn will sell activities in Italy to Suez) Gas de France will have to disinvest its 25% in SPE, a power producer in Belgium.

The EWCs will now have to sit together to negotiate the appropriate EWC for the new company.