Waste management service provider
) continues to reshuffle its business by hiving its small and
medium sized assets. The funds generated from these divestitures
will go to minimize the debt burden of the company. The
monetization program created enough funds to lower debts worth
$446 million (€350 million) since August 2012.
(ATP): ETF Research Reports
AMER WATER WORK (AWK): Free Stock Analysis
CONN WATER SVC (CTWS): Free Stock Analysis
VEOLIA ENVIRON (VE): Free Stock Analysis
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We note that the decision to trim the non-productive assets was
taken in December 2011. The objective was to concentrate more on
the highly productive growth regions. Besides, using funds
generated from divestitures will increase the company's financial
flexibility and allow Veolia to refocus on its organic growth
Veolia's assets divested thus far in the second half include the
sale of Ridgeline, a U.S. subsidiary specialized in wind power,
Atlantic Power Corporation
). The company also shed a portion of its Environmental Services
operations in Switzerland and a waste-to-energy facility in
Italy. Veolia divested all of Veolia Environmental Services
operations in Estonia and Lithuania, and its Dalkia operations in
Switzerland and Estonia.
These were in addition to the $3.86 billion (€3 billion)
generated from the divestiture of its U.K. regulated Water
activities and the U.S. Solid Waste business. The on track asset
sale program has thus encouraged the company to complete the
targeted $6.43 billion (€ 5 billion) of divestiture in the
We believe the paring of unwanted, non-core assets will make
Veolia a more competitive unit with adequate financial
flexibility for the smooth running of the business besides
sharing the benefits with its stake holders.
The company has presently undertaken other initiatives, including
the appointment of a Chief Operating Officer effective December
1, 2012. Though the company has just begun to realize the
benefits of restructuring, we need a few more quarters to measure
the full impact of these actions.
Veolia Environnement retains a short-term Zacks #3 Rank (Hold
rating). Presently, we prefer its Zacks #2 Rank (Buy rating)
Connecticut Water Service Inc.
American Water Works Company, Inc.
Based in France, Veolia Environnement is a provider of
environmental management services to its worldwide consumers.