Veolia CEO says Dassault could sell stake if stock price rises

PARIS, April 23 Wed Apr 23, 2014 7:11am EDT

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PARIS, April 23 (Reuters) - The head of French water and waste management group Veolia said on Wednesday its second-biggest shareholder, Groupe Industriel Marcel Dassault (GIMD), could sell its Veolia stake if the stock price rises.

The Dassault family holding company, which owns 6 percent of Veolia shares, resigned from Veolia's board last month following an unsuccessful attempt to oust chief executive Antoine Frerot.

Frerot told financial news website La bourse et la vie that the Dassault group had not indicated it wanted to sell Veolia shares as it withdrew from the board, but said he could see this happen if the stock price rises further.

"If in coming years we pursue our transformation of Veolia, I expect the stock price will rise, and I understand that the Dassault group could wait for that moment to disengage," he said.

Privately held GIMD was not available for comment.

Frerot's re-election as CEO will be put to a shareholders' vote at the company's annual general meeting on Thursday.

Veolia's board has already voted to extend Frerot's mandate, but board members representing its top three shareholders - France's state fund CDC (Veolia's largest shareholder with an 8.85 percent Dassault), Dassault and insurer Groupama - had abstained from that vote.

This followed weeks of talk of a boardroom coup in which some of Veolia's minority shareholders tried to unseat Frerot.

Sources familiar with the world's biggest environmental services group have said some shareholders are unhappy with the pace of restructuring at Veolia, whose stock has fallen some 40 percent since Dassault bought its stake in 2008.

At 14.33 euros, Veolia shares are up more than 50 percent over the past 12 months but trade at less than a quarter of their 2007 pre-crisis highs around 63 euros.

The CDC said last month it could reduce its Veolia stake. (Reporting by Geert De Clercq; Editing by Elaine Hardcastle)

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