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Negotiations are under way to transform the Lagardère group, owner of Hachette Livre, into a joint stock company, the group confirmed in a statement this morning (Monday 26th April).
The step would involve chief Arnaud Lagardère relinquishing full management control of the company. The Lagardère group is currently run under a special status unique to France called commandite, which gives him that control despite holding only some 7% of the capital.
The company stated the announcement was being made following press “rumours” at the weekend. Lagardère added that “there can be no certainty” about the outcome, and that it would make no further statement until it “communicate(s) in due course”.
Media reports started with the news weekly Le Point saying on Saturday (24th) that a truce among Lagardère shareholders was imminent, and would include a clause blocking a break-up of Hachette Livre or the rest of the group. Le Point said Lagardère chief Arnaud Lagardère would lose his special position at the helm, in exchange for a payment between ‚Ǩ200m and ‚Ǩ250m, which would enable him to pay his debts of ‚Ǩ164m. Lagardère would stay in his job until 2026, but would be accountable to the board of directors, which is not the case now.
The number of directors representing each shareholder is one outstanding point in the talks, as is the possibility of a clause to prevent a takeover bid by any one of them, press reports say.
The agreement would preclude carving up the group for five years, La Tribune claimed in a Reuters dispatch. It would also merge the two-tier governing structure into one, and would involve Amber Capital and Qatar selling their stakes of 20% and 13%, respectively. “This is a likely outcome,” an informed source said. The Lagardère supervisory board is due to meet today at 4 p.m. local time, the source added.
“Arnaud Lagardère is scoring points,” Jean-Clément Texier, merchant banker and president of Compagnie Financière de Communication told The Bookseller. The deal would give him "five years of comfortable income". The real question is whether (LVMH chief Bernard) Arnault or (Vivendi boss Vincent) Bolloré takes control of the group. "After that, anything could happen,” he said, adding: “History teaches us that Bolloré almost always ends up taking control of companies in which he first takes a minority stake.”