A deal to save a 90 billion euro merger between Suez and Gaz de France could be close to agreement.
The combined gas and electricity company would give the Government a far higher share than the previously planned 34 percent under the original deal.
French President Nicolas Sarkozy has demanded that Suez part with its historic water business, and focus on the energy sector. Before the President stepped in, Suez had refused to sell its environment assets.
This sale would help slim down Suez and allow the deal, drawn up 18 months ago, to go ahead.
Both French water company Veolia and investment company Wendel have shown interest in Suez’s water sector. But the sale could be made through a market listing.
Analysts said Suez could become a takeover target if the GDF merger deal fails. Both Suez and GDF stocks rose, ahead of a final decision expected on Monday.
Suez -Gaz de France merger looks likely