* State representatives key in vote on Corsica ferry
* Veolia unit Transdev tries to retake control of SNCM
* Veolia, CDC refuse to put more money in ferry operator
By Geert De Clercq
PARIS, May 12 Government representatives on the
board of Corsica ferry operator SNCM will vote on Monday to
decide whether Veolia can retake control of the
The vote is tricky for the government as siding with Veolia
could lead to protests by SNCM unions in Marseille ahead of
European elections in two weeks.
Veolia wants to put loss-making SNCM (Societe Nationale
Maritime Corse Mediterranee) under court protection to shield it
from a European Commission order to repay 440 million euros
($605 million) of state aid. Veolia has also said it will not
put any more money into the ferry company.
Veolia owns 66 percent of SNCM via transport firm Transdev -
itself a 50-50 joint venture between Veolia and French state
holding company CDC. But Veolia has not been able to impose its
will at SNCM because the chairman of the ferry company's board
sides with the unions and has voted against his employer.
SNCM's unions say the French government and SNCM's appeal
against the European Commission's state aid ruling will succeed
and that SNCM needs more time. They also want the government to
The board will also vote on Monday on whether to renew the
mandate of SNCM chief executive Marc Dufour. Dufour told
regional newspaper La Provence that he had little hope of
"I hope it will be, but I doubt it. My departure would be a
bad sign for the future of the company, it will lead people to
think they want to make SNCM disappear," he said.
Transdev has seven seats on SNCM's 14-member board, but with
chairman Gerard Couturier expected to back Dufour, it will need
the three state representatives to at least abstain to end
Dufour's mandate, a source close to Transdev told Reuters.
An attempt to oust Couturier in April failed as the state
representatives abstained from a vote to replace him with a
The French state has 25 percent of SNCM's capital, while the
ferry operator's staff own 9 percent of capital and have four
The transport ministry was not available for comment.
Transdev and Veolia have said SNCM's long-term business plan
was not credible as it is based on unrealistic forecasts for
ferry traffic growth.
But local politicians in Marseille led by conservative mayor
Jean-Claude Gaudin have called on the state to help SNCM, which
employs 2,600 staff and also provides work for some 2,400
suppliers and subcontractors.
Ahead of SNCM's partial privatisation in 2006, there were
weeks of strikes and protests in Corsica and Marseille. One of
the firm's ferries was hijacked and in the Corsican city of
Ajaccio a rocket was fired at the offices of the city's top
"The French government is petrified by the thought of a
major social conflict that would paralyse Marseille," French
daily Le Parisien quoted an insider as saying.
($1 = 0.7269 Euros)
(Reporting by Geert De Clercq. Editing by Jane Merriman)