* Dirty water is big business as regulation tightens

* Suez' GE Water acquisition sparks more consolidation

* Top 10 players each have just 1-3 pct market share

* Companies increasingly outsource waste water treatment

By Geert De Clercq

PARIS, Dec 13 (Reuters) - French waste and water group Suez expects more mergers and acquisitions in the very fragmented market for industrial water treatment, its CEO said, after its purchase of General Electric (NYSE: )'s GE.N water business in March for $3.4 billion.

Suez, which had 2016 revenue of 15.3 billion euros, now has about $2.7 billion revenue in industrial water following the GE Water acquisition, and it expects that to grow to more than $3.1 billion by 2020.

But that is a relatively small share of a $100 billion market, in which the top 10 players each have no more than a few percentage points of market share.

As environmental regulations tighten worldwide, companies are increasingly outsourcing the recycling and reuse of water from industrial processes to players such as Suez.

"Industrial water remains an extremely fragmented market with very few companies present on the whole value chain. This means several players are looking to buy parts of that chain," Suez CEO Jean-Louis Chaussade told reporters on Wednesday.

Suez will focus on integrating its GE Water acquisition in the next 18 months, but the firm remains on the lookout for further small to medium-size acquisitions to complete its range.

"We are reviewing our own portfolio to see what pieces we are missing in that value chain, while we are also looking at what is no longer useful and we could sell," Chaussade said, adding that this review would take a few months.

Suez and competitors such as French peer Veolia , Danaher DHR.N , Japan's Kurita , Solenis, and Pentair PNR.N clean up wastewater for industries from oil-and-gas, mining and power to chemicals, micro-electronics, pharmaceuticals and food-and-beverage.

"FURTHER CONSOLIDATION"

Suez estimates that market leader Ecolab ECL.N has $3.8 billion revenue in industrial water following its $5.4 billion acquisition of U.S. water treatment firm Nalco in 2011, while U.S.-based Xylem XYL.N and Finland's Kemira have industrial water revenues of $2.8 and $2.5 billion respectively.

In October, private equity firm AEA rejected Xylem's $2.5 billion bid for Evoqua, the former Siemens (NS: ) Water Technologies, which AEA bought in 2014 and which has an estimated $1.1 billion in industrial water revenue.

In a bid to get a higher valuation, AEA took Evoqua AQUA.N public, adding another listed player to the crowded field of water treatment firms. In early December Xylem bought Canadian wastewater specialist Pure Technologies for $397 million.

Chaussade said companies, rather than handling pollution themselves at individual plant level, want treatment services for dozens of plants in the same company.

"This way they can focus on their core business and turn a capital expense into an operating cost," he said.

Chaussade said he expected future water M&A to be focused on smart water services, specialised equipment and mobile, skid-based filtering systems.

"Our GE Water acquisition has excited a lot of other players. I am convinced this market will see further consolidation," Chaussade said.