French giants SUEZ and Gaz de France are allegedly ready to merge in the near future, according to reports by Agence France-Presse and Reuters. The two would create a 123 billion dollar group and one of the world's largest energy groups by market capitalization, behind only the Russian giant Gazprom and France's state-owned Electricite de France (EDF), according to the AFP.

The two are to announce the merger in a joint statement before the opening of the Paris stock exchange at 9:00 am local time on Monday. The agreed merger is allegedly the result of negotiations spearheaded by the office of French President Nicolas Sarkozy, who over the weekend held discussions with SUEZ.

"It is a very balanced deal organized around GDF's core business," one of the sources for Reuters news agency said. "We are sticking with what was planned, the same parity and the same organization. It is a merger of equals. The idea is that the new entity would keep 34-35 percent of the environment activity and would keep control of it. The rest would be listed on the stock exchange."

The merger was actually announced since 2006, but there have been no concrete steps since. On February 25, 2006, French Prime minister Dominique de Villepin announced the merge of Suez and Gaz de France, but it seems it took a year and a half for the deal to move forward into practice.

SUEZ is the result of a 1997 merger between the Compagnie de Suez and Lyonnaise des Eaux, which was a leading French water company. Compagnie de Suez can be traced back to the 1822 founding of the General Dutch Company for the Favoring of Industry by King William I of the Netherlands. Gaz de France has been created at the end of World War II by the French Government.