Dalkia is to acquire TDU from ASI subsidiary Trane Commercial Systems (TCS), a leading global supplier of commercial HVAC equipment, systems, services and solutions.

TDU's business is organised into three closely related divisions—equipment sales, equipment installation and services— with nearly 500 employees at 14 locations in Australia and New Zealand. In 2005, it reported AU$127 million (€76 million) in revenue. 50% of TDU's revenue is in the services activity.

"Dalkia's international growth strategy is focused on the interesting opportunities offered by the Asia-Pacific markets," said Dalkia Chairman Olivier Barbaroux. "The acquisition of TDU will enable us to deploy our portfolio of energy services in Australasia and extend our current operations in the fast growing heating and air conditioning markets in Central and South-east Asia. The acquisition of TDU will offer major synergies with Veolia Environnement's other businesses in the region."

In a fast growing market, TDU's primary customers are owners and end-users of commercial buildings, the public sector, property developers and builders, building managers/owners, large retailers, leisure facilities operators and facilities managers. By acquiring TDU, Dalkia will also benefit from an exclusive licence to distribute Trane-branded equipment, systems and controls in Australia and New Zealand.

For Dalkia, TDU represents an operational platform from which to offer a variety of energy and environmental solutions and services in Australasia. Its acquisition will broaden Veolia Environnement's portfolio of environmental solutions for its Australian and New Zealand customers in the region. In 2005, Veolia Environnement reported €842 million in revenue in Australia and New Zealand, with more than 7,000 employees in its Water, Transportation and Waste Management divisions.

With more than 47,000 employees in 38 countries, Dalkia reported 2005 managed revenue of €6.1 billion. It currently manages 650 district and local heating and cooling systems, including 329 in France. A subsidiary of Veolia Environnement and Electricité de France (EDF), Dalkia is the leading European provider of energy services to local authorities and businesses. Since its creation, it has focused on energy and environmental optimisation. It meets customer expectations by delivering customised, end-to-end solutions to ensure comfortable living and efficient energy supply, including management of heating systems and energy and industrial fluid production facilities, energy plant engineering and maintenance services, technical services for commercial and industrial building operation, and global building management services.

Trane, the air conditioning systems and services business of American Standard Companies, is a leading global provider of indoor comfort systems and comprehensive facility solutions. Its offerings include energy efficient heating, ventilating and air conditioning systems, service and parts support, advanced building controls and financing solutions. Each Trane system is designed to meet the specific needs of customers who want heating, cooling, dehumidifying and air cleaning systems for residential, commercial, institutional and industrial applications. In 2005, Trane contributed $6 billion to American Standard's total sales of $10.3. For more information, visit the Trane Web site at www.trane.com.

Veolia Environnement is a corporation listed on the NYSE and Euronext Paris. This press release contains "forward-looking statements" within the meaning of the provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations or beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These factors and uncertainties include in particular risks related to customary provisions of acquisition transactions as well as those described in the documents Veolia Environnement has filed with the U.S. Securities and Exchange Commission. Veolia Environnement does not undertake, nor does it have, any obligation to provide updates or to revise any forward-looking statements. Investors and security holders may obtain a free copy of documents filed by Veolia Environnement with the U.S. Securities and Exchange Commission from Veolia Environnement.

Dalkia: Julie Langlais- +33 (0) 1 71 00 74 81
Veolia Environnement: Marie-Claire Camus- +33 (0)1 71 75 06 08