Veolia Environnement SA (VIE) is mistakenly abandoning its global ambitions by selling U.S. and U.K. assets to cut debt, Jean-Francois Dehecq, to be replaced as a director of the world’s biggest water company tomorrow, told Le Monde.
The planned sale of the company’s stake in Veolia Transdev is also an error that may hurt relations with municipalities on which the utility depends for waste and water contracts, Dehecq said in an interview with the newspaper. Dehecq is scheduled to be replaced at an annual shareholders’ meeting. Marie-Claire Camus, a spokeswoman for Veolia, declined to comment.
The company’s strategy is now based on financial ratios, “short-term accounting” and “wretched” asset sales to boost the share price, Dehecq was quoted as saying in Le Monde.
Chief Executive Officer Antoine Frerot plans to sell assets and cut costs, departing from the growth under predecessor Henri Proglio, still a director, who expanded Veolia to 77 countries.
The utility posted a 12 percent slump in first-quarter earnings on May 4 after a “difficult” economy hurt waste operations and profit from domestic water contracts dropped.
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