PARIS (Reuters) - Activist fund Amber Capital said on Tuesday it fully shared concerns expressed by French utility Engie's (PA:ENGIE) board on the necessity to adequately value its stake in Suez (PA:SEVI), after Veolia (PA:VIE) offered to buy a 29.9% stake for 2.9 billion euros ($3.38 billion).
Engie, which owns almost 32% of Suez, rejected Veolia's initial advance but has said it would consider a higher offer.
Veolia is due to improve its bid to buy the bulk of Engie's stake in smaller rival Suez by Sept. 30.
Amber said in a letter sent to Engie's board that Veolia's project would open the path to creating a European champion for the environment.
The activist fund also said that it was deeply concerned by hostile methods used by Suez's management consisting in integrating its water business in France into a Dutch foundation.
"Suez's management does not serve the best interests of its shareholders", Amber Capital said.