(Bloomberg) -- Veolia Environnement SA agreed to sell Suez SA’s waste activities in Britain to Macquarie Group Ltd. for 2.4 billion euros ($2.44 billion) after the country’s antitrust authority raised competition concerns.

Veolia’s announcement, confirming an earlier Bloomberg News report, marks the last step in its acquisition of a large chunk of French rival Suez, which was completed in other parts of the world earlier this year. Demand is growing for water and waste-treatment and recycling services as governments around the globe bring in more stringent rules to fight pollution.

“It’s a very attractive valuation,” Veolia Chief Executive Officer Estelle Brachlianoff said Monday on a conference call. The proceeds will give the firm “room to maneuver on our balance sheet to invest in strategic projects,” she said, citing interest in recycling businesses and water-treatment technologies.

Veolia shares rose as much as 3.7% before paring gains to trade up 0.6% at 24.13 euros as of 11:23 a.m. in Paris.

The UK competition watchdog said in May that Veolia’s acquisition of Suez’s business in the country may hurt competition in the water and waste-treatment sector and drive up prices at a time when consumers are already being squeezed. While expressing its disagreement with the regulator’s analysis, Veolia said in June that it would sell the assets.

“This sale concludes antitrust divestitures which will have been done in less than a year at very good multiples,” analysts at JPMorgan Chase & Co. said Monday in a note. “This should give Veolia the balance-sheet flexibility to resume some external growth.”

Also see: Veolia Shrugs Off Fears of Global Slowdown as Profit Jumps

The transaction remains subject to approval by the UK Competition and Markets Authority. An investor group led by Meridiam SAS and Global Infrastructure Partners, which already bought Suez’s business in France and several other countries, also still has the right to make an offer for the UK assets by matching Macquarie’s price.

Companies that collect, treat and recycle waste have recently received takeover interest from a range of financial investors. Macquarie agreed to buy Australian waste-management company Bingo Industries Ltd. last year for A$2.26 billion ($1.6 billion). In 2020, KKR & Co. acquired Pennon Group Plc’s waste-management arm Viridor Ltd., while UK company Biffa Plc received a possible bid from Energy Capital Partners LLC two months ago.

Brachlianoff has set out to offload assets to cut Veolia’s debt, which swelled to 22.4 billion euros at the end of June from 13.8 billion euros a year earlier. She’s also investing more in fast-growing areas such as treatment of hazardous waste and water, and plastic recycling.

(Updates shares in fourth paragraph.)

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