Acquisition

HomeServe plc acquisition of Veolia's 51% shareholding in Doméo

HomeServe plc ("HomeServe") the international home emergency business announces today that it has reached agreement with Veolia Environnement ("Veolia") to acquire Veolia's 51% share of Doméo SA, its joint venture in France of which HomeServe already owns 49%. Following completion of the transaction, which is expected within the next week, Doméo SA and its subsidiary Doméo Assistance SA, (together "Doméo") will be 100% owned by HomeServe.

HomeServe and Veolia have also agreed a long term marketing agreement providing Doméo with continued use of Veolia's brands in France.

Doméo SA, is the joint venture between HomeServe and Veolia, which was established in 2001 and in which HomeServe currently owns 49%, with the remaining 51% owned by Veolia through its Proxiserve subsidiary. It is a leader in the provision of insured home emergency policies in France with 890,000 customers and 2.3m policies. The aggregate profit after tax, as reported in the statutory accounts of Doméo SA and Doméo Assistance SA, for the year ended 31 March 2011 was £11.3m. The aggregate gross assets at 31 March 2011 were £53.7m.

This acquisition provides HomeServe with full control of Doméo and will enable it to further develop Doméo's product range and broaden the range of affinity partners in France.

The total consideration for the acquisition is £83.0m, which will be paid in cash at completion and will be funded through existing bank facilities. Doméo's revenues and profits are weighted to the final part of the financial year, where it is expected to generate around 45% and 60% of its revenues and operating profits respectively in the final 4 months of the year ended 31 March 2012. The transaction is expected to be earnings accretive in its first full year.

Richard Harpin, Group Chief Executive of HomeServe commented:

"HomeServe began its international expansion when the group entered France in 2001. I am delighted that, having set up the business organically, ten years ago, with Veolia, we now have the opportunity to make Doméo a wholly owned part of HomeServe. This agreement will also enable us to continue our important trading relationship with Veolia in France through our new long term marketing agreement in addition to our agreements in the UK and our testing with Veolia Aqua in Italy."

Jean-Michel Herrewyn, Directeur Général of Veolia Eau commented:

"Veolia is pleased to announce this transaction and to be able to extend its relationship with HomeServe through the new marketing agreement. HomeServe's product offering is an important part of the services that we offer our water customers not just in France but also in the UK and Italy and there is also the potential to work together via long term marketing agreements in some of our other territories in the future. "

Conference Call

A conference call for analysts and investors will take place at 8.30am this morning. The conference call can be accessed by dialling +44 (0)20 3140 0668 and pin code 270417#. A replay of this call can be heard by dialling +44 (0)20 3140 0698 and pin code 381240# later in the day for a period of 2 weeks.

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