UPDATE 2-Empire-building over as Veolia cuts debts
* Net profit 394 mln euros, reversing 490 million loss
* Acquisitions ruled out; European waste market seen slow
* CEO says 2013 focus will be on cost cuts
* Shares up more than one percent in high-volume trade (Updates with additional comment, market reaction)
By Benjamin Mallet and Geert De Clercq
PARIS, Feb 28 (Reuters) - Veolia Environnement, the world's leading water and waste group, plans to step up efforts to reduce debts left over from an acquisition spree and focus on growing organically in emerging markets.
Chief executive officer Antoine Frerot said on Thursday that major takeovers were a thing of the past. He also said the French company would accelerate cost cuts in mature markets to free up money for investment elsewhere.
"Our group is now freeing up capital for its repositioning in growth markets," Frerot said on Thursday.
Veolia already earns about a third of its turnover in high-growth markets, a share that should grow to 50 percent in five year's time.
In Europe, waste markets are depressed by slow economic growth, while in France's water markets cash-strapped local governments have put margins under pressure.
The company, whose debt peaked at 16.5 billion euros ($21.6 billion) in 2008 as it built up its empire via M&A deals, wants to cut leverage further this year, reducing net financial debt to 8-9 billion euros from 11.3 billion at the end of December.
It plans to end 2013 with net debt on an adjusted basis of 6-7 billion euros.
The utility, which is withdrawing from half the countries in which it operates, completed asset sales totalling 3.7 billion euros in 2012.
The group is the world's largest private supplier of drinking water - providing water for 100 million people worldwide, and treating waste water for 71 million people.
For 2012, the company reported a net attributable profit of 394 million euros, reversing a 490 million loss in 2011. The dividend was left unchanged at 70 cents per share.
Revenue rose 3 percent to 29.4 billion euros from sales restated to include the effect of divestments and acquisitions. The company expects organic growth to be about the same amount in 2013.
Veolia's shares were up about 1.0 percent by 1608 GMT after rising more than 6 percent earlier in the session in the heaviest trading volume since the start of the year.
The shares are up about 5 percent so far this year. They hit a low of 7.4 euros in November, when they were down 89 percent from a high of 65.6 euros in 2007. ($1 = 0.7628 euro) (Reporting by Geert De Clercq and Benjamin Mallet; Editing by Dan Lalor and Jane Merriman)