Moody's could cut Veolia

Moody's Investors Service said it placed the A3 senior unsecured ratings of Veolia Environnement SA on review for possible downgrade. The Prime-2 senior unsecured rating was affirmed.

Moody's said the review follows Veolia's recent presentation of its strategic plan and updated outlook.

The plan is designed to address the pressures being exerted on revenue growth and profitability in the mature economies in which it operates and provides for (a) the restructuring of the group's divisions and portfolio of activities through a €5 billion divestment program over 2012-13; (b) a reduction in net financial debt from an estimated €15 billion at the end of 2011, to under €12 billion by the end of 2013; and (c) a reduction in its cost base by streamlining and introducing greater standardization of management structures across the group.

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