Brisk Profits for an 'Old Business'

With strong growth and a taste for acquisitions, France's Veolia Environnement, the world's largest water company, shows that utilities aren't necessarily dowdy

The birth of utility giant Veolia Environnement (VE) was hardly a glorious moment. In early 2000, Henri Proglio got a call from his boss Jean-Marie Messier, then the hotshot CEO of Paris-based conglomerate Vivendi Universal. "He said, 'We can't be weighted down any more with these old businesses that don't interest anybody,'" recalls Proglio, who ran Vivendi's water-utility business. Messier planned to spin off Vivendi's water, waste, and energy units—and saddle them with most of the $26 billion in debt he had run up while acquiring media properties such as Universal Studios.

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