PARIS (Reuters) – Qatar’s sovereign wealth fund stepped into the market battle over struggling Lagardere LAGA.PA on Wednesday by calling for fair representation for all large shareholders in the French media and publishing group.
Qatar’s rare public incursion adds up pressure on the company’s chief executive Arnaud Lagardere and increases the chances of a shake-up within the group, which has become the arena for a proxy war involving two French billionaires, Bernard Arnault and Vincent Bolloré.
Qatar Holding, a subsidiary of the Qatar Investment Authority and Lagardere’s third-biggest investor with 13%, said in a statement late on Tuesday that it considered it “legitimate that all significant shareholders be fairly represented.”
This comes after calls by Lagardere’s two biggest shareholders, media group Vivendi VIV.PA, controlled by Bollore, and activist fund Amber, to hold a general meeting to replace four of the nine members of Lagardere’s supervisory board.
Lagardere has rejected the request, which Amber and Vivendi will defend at a court hearing in Paris on Thursday.
Vivendi owns 23.5% of Lagardere’s shares, while Amber holds about 20%, meaning that shareholders owning more than 50% of the share capital are asking for seats at the company’s board.
“The management welcomes the request for representation by the QIA on the board,” a spokeswoman for Lagardere said, adding that the fund’s request would be reviewed for the next annual general meeting slated for next spring.
Loss-making Lagardere, home to France’s biggest publishing group Hachette and well-known outlets like Paris Match magazine and radio station Europe 1, has been under fire for years from Amber over its governance and performance.
Bollore, via Vivendi, first came to the rescue of Arnaud Lagardere to fend off Amber.
He then switched sides after Bernard Arnault, the head of the world’s biggest luxury group LVMH LVMH.PA, invested in Lagardere’s family holding, which controls the group thanks to a peculiar French legal structure despite owning only 7% of the shares.
Arnault, who was the friend of Arnaud Lagardere’s late father, said his investment was meant to shore up the group’s integrity. Bollore made no comment on Vivendi’s investment but a source close to the matter said he might be interested in taking control of Hachette and Europe 1.
At present, the Qataris and other shareholders are not explicitly represented on Lagardere’s supervisory board, which took on new members including former French President Nicolas Sarkozy this year.
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