``We are looking at all the cost advantages for the realization of all the possibilities,'' Lagarde told reporters today at an economic conference in Aix-en-Provence, France. She didn't give a timeframe for a decision.
French President Nicolas Sarkozy, elected May 6, indicated during his campaign that he might scrap the merger. The combination of Gaz de France, operator of Europe's largest natural-gas network, and Suez was announced in February 2006 by Dominique de Villepin, then France's prime minister, to ward off a possible bid for Suez from Enel SpA, Italy's biggest utility.
Lagarde declined to say when officials will decide on the matter. The government has said a decision would be made at the beginning of this month. Sarkozy said in an interview today in the Journal du Dimanche that he aims to ``rapidly'' present the ``best possible solution'' for the utilities.
The original merger plan was for Gaz de France to absorb Suez, owner of Belgium's biggest power supplier, through a one- for-one share swap, with Suez shareholders being paid an exceptional dividend if the company's share price remained higher than Gaz de France's. Suez is the world's second-largest water company after Veolia Environnement SA.
Asset Sales
The agreement was thrown into question after France's highest court ruled last November a merger couldn't take place before this month.
Lagarde also said today that sales of stakes in state- controlled companies are ``not necessarily'' needed to reduce the nation's debt.
France's debt on March 31 stood at 1.176 trillion euros, or 65 percent of gross domestic product, up from 1.142 trillion euros, or 63.7 percent, on Dec. 31, Paris-based national statistics office Insee said June 29.
France may soon sell a 5 percent stake in Electricite de France SA worth about 7 billion euros, the Journal des Finances reported yesterday, citing unidentified bankers working on the transaction.
``The state manages its portfolio as any good asset manager, according to opportunities,'' Lagarde said when asked whether the government is preparing to sell holdings in Electricite de France, Europe's largest power generator, or other state- controlled companies.
Analysts have said the government could move quickly to sell a stake in Areva SA, the world's largest maker of nuclear reactors.
EDF is 87 percent state-owned and has a market value of 142 billion euros. Shares in the company have risen 42 percent this year. A stake sale would follow the June 25 sale of 5 percent of France Telecom SA for 2.65 billion euros.
Bloomberg
by Tara Patel
Dominique de Villepin
Christine Lagarde
Sarkozy
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