Rabat – Veolia, a French utilities company, has announced the signing of an agreement to sell its entire stake in Lydec to Societe Regionale Multiservices Casablanca-Settat, in compliance with commitments made to Moroccan competition authorities.
Lydec has managed public services for the distribution of drinking water, electricity, wastewater, and public lighting in Casablanca and its surrounding region for over 27 years.
“We recognize Lydec’s contribution to the development of essential water and sanitation services in Morocco for more than 27 years,” said Estelle Brachlianoff, Chief Executive Officer of Veolia in a statement on Friday.
“This sale will enable a smooth transition for the benefit of local populations and will support the establishment of the new Multiservice regional corporations,” Brachlianoff continued.
The sale is expected to finalize by the end of 2024 pending necessary administrative approvals and will not impact Veolia’s 2024 financial guidance or its GreenUp strategic plan objectives, the statement explained.
Post-transaction, Veolia will continue to be part of Morocco’s utility sector, maintaining its presence in water and electricity distribution through contracts in Rabat, Tangiers, and Tetouan.
The news follows a substantial $10 million fine imposed on Veolia by Morocco’s Competition Council in January.
The Council accused Veolia of “unauthorized economic concentration” after it failed to divest certain assets of Suez, including Lydec, as per the conditions set during the Veolia-Suez merger approval in late 2021.
The merger had given Veolia close to a monopoly over water and electricity services in major Moroccan cities, including Casablanca, Rabat, and Tangier, through utilities companies Lydec, Redal, and Amendis.
The acquisition raised concerns about competition law violations, prompting the Competition Council to demand the divestment of Lydec to maintain market balance.
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