Areva CEO says no plans for capital increase
PARIS, Oct 14 (Reuters) - Areva SA has no plans to raise fresh capital, Chief Executive Luc Oursel said on Tuesday, speaking a week after the French state-controlled nuclear group announced a cost saving and asset sale plan to avoid a downgrade of its debt to junk status.
"For three years the team that runs Areva has sold assets, redirected its investment policy, and done some significant cost savings, a billion euros worth, and we will do more. We have done all that so that we don't need a capital increase," he told BFM Business Radio.
"What I've always said to the Areva team is we have to stand on our own two feet. That's what will make the company strong again," he said.true
"It's not about isolationist thinking, it's just saying that to put the company back on its feet we have to do it from within - improve our performance. We've done it. We have to do more of it, and we will continue to do it, I hope."
On Oct. 7, Areva announced plans to cut spending by 200 million euros ($254 million) over the next two years, and said it could dispose of non-core assets and minority stakes in projects worth at least 450 million euros by the end of 2016 - all in a bid to bolster its financial structure and avoid a debt downgrade.
Two days later Standard & Poor's confirmed its credit rating on the company, which is 87 percent state owned, avoiding a downgrade that would have pushed it into junk territory.
Such a downgrade would have been a major embarrassment for Areva ahead of a big nuclear export trade fair that begins on Tuesday.
It would also have weighed on its stock price, as many funds are not allowed to hold junk-rated securities.
Areva shares were up 0.3 percent on Tuesday morning, outpacing a lower French stock market. (1 US dollar = 0.7878 euro) (Reporting by Andrew Callus and Gilles Guillaume; editing by Blaise Robinson)
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- October 14, 2014
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