Total to Buy French Energy Retailer

Total has reached a deal to take over leading independent French energy retailer, Direct Energie.

The French oil major said April 18 it has agreed with shareholders who control 74.33% of the retailer to buy the company, for an aggregate acquisition price of some €1.4bn ($1.73bn).

It will then offer to buy up remaining shares traded on Euronext Paris at the same price, €42 per share, which Total said represents a 30% premium above Direct Energie’s April 17 closing price; the acquisition of the blocks of shares is expected to be completed by mid-year 2018, and the proposed tender offer will be filed immediately after such completion.

Total CEO Patrick Pouyanne said: “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.”  

Direct Energie has installed capacity of 1.35 GW, comprising 800 MW of gas-fired power plant and 550 MW of renewable electricity, as well as a 400 MW gas-fired power plant under construction. These will supplement Total’s 900 MW installed capacity, and various projects under development. Direct has over 2.6mn mostly residential customers mainly in France but also Belgium and achieved 2017 group revenue of just under €2bn. Xavier Caitucoli, CEO of Direct Energie said his company’s teams “will be at the heart of the strategy of one of the greatest French companies.”

Several leading French independent retailers have been largely bought up by larger concerns such as Engie, EDF and Eni in recent years, while Shell recently completed its purchase of UK retailer First Utility. Total said it wants over 6mn retail customers in France plus a further 1mn in Belgium by 2022.