The boards of directors of the French state-owned gas supplier GDF and the Franco-Belgian energy and environment group Suez agreed on Wednesday to merge, forming one of the world's largest energy groups, according to dpa. A spokeswoman for GDF told Deutsche Presse-Agentur (dpa) that shareholders of both companies would finalize the merger on July 16. The decisions of the two boards came nearly two and a half years after former French prime minister Dominique de Villepin announced the merger as an act of "economic nationalism," to prevent a hostile takeover bid of GDF by Italian energy giant ENEL. The new company, Suez GDF, will have a market value of 90 billion euros (140 billion dollars), of which the French state will retain a minority share of 35.6 per cent, with veto rights. The merger will involve an exchange of 22 Suez shares for 21 shares of GDF. The new company will offer both gas and electricity abroad and at home, where it will make for a powerful rival to the former state-owned electricity supplier EDF. In 2007, Suez posted turnover of 47.5 billion euros, nearly twice as much as GDF. Suez earned profits of 3.9 billion euros last year, compared to 2.5 billion euros for GDF. The shares of both companies lost ground on the Paris Bourse on Wednesday, with GDF stock losing 1.48 per cent, to finish at 43.16 euros, and Suez shares dipping by 1.45 per cent, to 47.02 euros.
