PARIS (Reuters) - State-owned French nuclear power engineering group Areva AREVA.PA is to get a new board of directors and a chief executive, replacing the current supervisory board and executive management committee to give the government more say in the firm.
Economy Minister Arnaud Montebourg told the French Senate that Areva’s two principal shareholders, the state nuclear institute CEA and the government itself, had sent a letter to Areva two weeks ago asking it to set up a board of directors.
He said this would allow the state shareholders to better control the firm and to make important decisions on the board, be it about the firm’s uranium mining activities, alliances, purchases or divestments.
“It is an important issue, as we have experienced a number of frustrating instances where the supervisory board was not able to intervene in strategic decisions,” Montebourg said.
Montebourg said nothing about the position of Areva chief Luc Oursel, but financial daily Les Echos said he would remain as the company’s top manager.
The paper said Areva’s executive committee, headed by Oursel, and its supervisory board, headed by Pierre Blayau, would be replaced by a structure with a chief executive officer - Oursel - and a board of which Blayau would become chairman.
The planned change in governance follows a scathingly critical report by the top public auditor of Areva’s management under Oursel’s predecessor Anne Lauvergeon.
The report said the executive committee alone had decided on the contract to build a nuclear reactor in Olkiluoto, Finland, where delays and cost overruns have resulted in a 3 billion-euro loss.
It also said that insufficient oversight and even “dissimulation” were among the reasons for Areva’s ill-fated 2007 acquisition of uranium mine UraMin, on which it later to wrote down 1.9 billion euros.
The report said a board of directors would enable the representatives of the French state to decide on major contracts and to approve its accounts.
Lauvergeon has denied all wrongdoing.
The Commissariat a l‘Energie Atomique (CEA) and the French state own 61.52 and 21.68 percent of Areva respectively, Thomson
Reuters data show. State-backed Caisse des depots owns another 3.32 percent, giving overall state ownership of 86.52 percent.
Utility group EDF (EDF.PA), itself 84 percent government owned, owns a further 2.24 percent of Areva, and the Kuwait Investment Authority owns 4.82 percent.
Reporting by Jean-Baptiste Vey and Geert de Clercq; Editing by Andrew Callus and Greg Mahlich