This French Water Company Doesn’t Make Bottled Water. It’s Bigger Than That.
Vite! Name a French water company besides Perrier or Evian. How about Veolia Environnement, a large global environmental services company that produces and distributes drinking water and treats wastewater (and has waste management and energy businesses).
Though you might not be familiar with Veolia (pronounced vee-OH-lee-uh, after the Greek mythological character Aeolus, keeper of the winds), it’s hardly a new kid on the block. The company, then called Compagnie Générale des Eaux, or CGE, was founded in 1853 by Napoleon III’s imperial decree to supply France with drinking water.
For more than a century, the company focused on water, but starting in 1980, it began to diversify—into waste management, energy, transport services, construction, and real estate. In 1998, CGE changed its name to Vivendi (remember them, oui?). In 2000, it merged with French media company Canal+ and Seagram, owner of Universal Studios and Universal Music Group, to form Vivendi Universal. That same year, Vivendi divested Vivendi Environnement, which included the water businesses and was soon renamed Veolia Environnement.
Today Veolia operates in 55 countries, with some 60% of its business in Europe, and is the largest private water operator in the U.S., with drinking water and waste operations in some 550 communities including ones in New York, New Jersey, Delaware, Wisconsin, Idaho, and Louisiana.
For its fiscal year 2025, Veolia did some $50.1 billion in revenue, with $5.3 billion coming from its North American business. Earnings before interest, taxes, depreciation, and amortization grew 6.3% to $8 billion. It is expanding its U.S. hazardous waste business, buying companies in Massachusetts, California, and Texas, as well as expanding the treatment of PFAS (per- and polyfluoroalkyl substances), so-called forever chemicals, in water.
Four years ago, the company resolved a bitter takeover battle with rival French water giant Suez by buying it for around $15 billion. After some deal-digesting, Veolia’s stock has been gaining momentum, matching the S&P 500 over the past two years and outpacing the index by 21% to 9.6% year to date. U.S. investors can trade Veolia’s American depositary receipts on the over-the-counter markets under the ticker VEOEY. Morgan Stanley analyst Arthur Sitbon rates it an outperform, arguing that continued profitability improvement isn’t priced in Veloia’s stock.
I asked Estelle Brachlianoff, who became Veolia’s CEO in 2022 in the wake of the Suez deal, what will drive the stock going forward. “We are the only company where you can invest in just one company on a worldwide basis and bet on mega trends like water scarcity, health, and environment, as well as reshoring of strategic industries, for decades to come,” she says.
And what about those water-thirsty data centers in the U.S.? “So far it’s not a big chunk of our business,” she says. “I would qualify it as a rising opportunity.” Brachlianoff notes Veolia is working with Taiwan Semiconductor Manufacturing at its mega chip complex outside Phoenix. And Veolia recently announced a collaboration with Amazon.com to reduce water use at its data-center operations in Mississippi.
Last year I spoke with Brachlianoff when the French stock market was faltering, and she complained that Veolia was unfairly punished for being a French company even though only 20% of its business was domestic. Sounds like they are throwing out the baby with the bathwater, I said. Brachlianoff paused for a moment and then replied, “But we aren’t a baby.”
Just ask Napoleon III.