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Last Updated: Tuesday, 2 January 2007, 10:46 GMT
Takeover rumours lift Suez shares
A worker demonstrating against the Gaz de France share sale
The government supports Gaz de France's merger plan with Suez
Shares in utility group Suez have risen after billionaire French investor Francois Pinault refused to rule out a possible takeover bid for the firm.

Mr Pinault's holding company Artemis said it had taken no decision yet about making a bid for the French water firm, but added: "All options remain open."

Reports last week suggested that Mr Pinault planned to put forward a 70bn-euro ($92bn; 47bn) bid for Suez.

Such a move could scupper a planned merger between Suez and Gaz de France.

Shares in Suez rose 1.4% in morning trading on the Paris stock exchange.

Political pressure

France's Capital magazine said Mr Pinault intended to break up Suez if he succeeded with his bid, selling the firm's energy assets to state-run Gaz de France and its environmental operations to French utility group Veolia.

Government-backed plans for an 80bn-euro merger between Suez and Gaz de France have faced stiff political opposition in France, because the deal would in effect require the privatisation of Gaz de France.

The proposed merger of the two companies to create a French national champion followed reports that Italian group Enel was planning to make a bid for Suez.

A court has since ruled that the French deal cannot go ahead until the full liberalisation of European Union energy markets on 1 July - after France's presidential election.

Mr Pinault's business empire includes luxury group PPR, which owns the Gucci fashion label.


SEE ALSO
Suez to start Gaz de France talks
08 Dec 06 |  Business
Suez-GDF merger hits new delays
01 Dec 06 |  Business
EU says Suez can merge with GDF
14 Nov 06 |  Business
Confidence behind French gas deal
17 Aug 06 |  Business
EU calls for joint energy policy
08 Mar 06 |  Business

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