Vivendi Water has won the international invitation to tender organized for the privatization of Prague's water company, PVK.
Vivendi Water will operate all water and wastewater services - treatment and distribution of water, collection and treatment of wastewater - for 1.2 million people living in Prague and its suburbs until 2013. The contract is worth average revenues of 110 million euros a year for 13 years.
The tender submitted by Vivendi Water was judged the best on several criteria, including the price of 174 million euros offered for the acquisition of 66% of PVK stock, owned previously by the Czech state. The other criteria were the strategy proposed for the company, technical proposals, and the productivity gains requested by the Czech government.
Vivendi Water's project includes a rapid reduction in leakage from the network, improved treatment of the city's wastewater, an ambitious personnel training program, and the introduction of a modern customer service organization. The rate at which the price of water has been rising - a tenfold increase in ten years-will be brought down to the level of inflation within three years.
Over the past several years, Vivendi Water has gained significant experience in the transformation of major water services in the Czech Republic, both from the technical and social policy viewpoint. This experience enabled the company to differentiate itself from its competitors.
Vivendi Water already serves 3.3 million people in the Czech Republic, principally in Bohemia, of which Prague is one of the main cities. Its very strong presence in the area enabled the company to build many synergies into its offer, especially in the areas of sourcing, purchasing, and training.
Thanks to its operations in the region and strong presence in southwest Germany, Vivendi Water will be the preferred partner of Prague and the Czech government within the context of a monitoring and modeling program of River Moldau water. The experience gained in this domain in France and the U.K, as well as some of the resource management programs developed at the Berlin Competence Center, will be used to provide overall environmental management of the river. Vivendi Water is reaffirming its role as an overall manager of the environment alongside municipalities and industry.
The development of its local operations and skills will also enable Vivendi Water to strengthen its business development teams in the field of industrial outsourcing contracts in central Europe. The prospects for this market are linked to the convergence of the region's economies and the upcoming European Union membership of the Czech Republic, Hungary and Poland.
The Czech government's confidence in Vivendi Water, the premier global water company, confirms its role as number one in Europe, where it provides drinking water to 50 million people and wastewater treatment services for 38 million. Outside France, 24 million people benefit from the company's water services, and 21 million for wastewater treatment. These figures take into account the international tenders won in Budapest (1998), Berlin (1999) and Bucharest (2000).
Vivendi Water, a subsidiary of Vivendi Environnement, groups together all the business activities of Générale des Eaux and USFilter. The world's leading water company serves more than 100 million customers in over 100 countries, and has more than 67,000 employees. In 1999, the group generated revenues of 11.9 billion euros.
Important disclaimer
This [document/press release] contains forward-looking statements within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations or beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: difficulty in integrating acquisitions, inability to identify, develop and achieve success for new products, services and technologies; increased competition and its effect on pricing, spending, third-party relationships and revenue; inability to establish and maintain relationships with commerce, advertising, marketing, technology, and content providers. Vivendi Universal does not undertake any obligation to provide updates or to revise any forward-looking statements. Investors and security holders may obtain a free copy of documents filed by Vivendi Universal and its predecessor, Vivendi, with the U.S. Securities and Exchange Commission at www.sec.gov or directly from Vivendi Universal.
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