Le Monde's Ancien Régime Battles Shareholder Revolutionaries

17 January 2008

PARIS: In what some liken to a re-run of the French revolution, the ancien régime of top-selling French daily newspaper Le Monde is fighting for its independence against the Sans-Culottes of commercialism.

Specifically, French media titan Lagardère and its Spanish counterpart Grupo Prisa, which between them hold 32% of the newspaper's stock.

But the 60.4% controlling stake in Le Monde is held by its staff association, noble proletarians under whose leadership the paper is expected to declare a loss of around €10m ($14.84m; £7.55m) for 2007.

In addition, the ancien régime is said to have amassed an accumulated debt of around €150m.
In short, the newspaper urgently needs cash, which Lagardère and Prisa are currently dangling beneath the noses of the controlling staff shareholders. But the latter fear that by accepting the cash they will cede control to the minority duo.
Instead they propose that editor Eric Fottorino become interim chief executive of the Le Monde Group – a move rejected by the external members of the newspaper's supervisory board as well as Lagardère and Prisa.
Perhaps sensing the shade of Madame Guillotine, Fottorino declares: "There is no question of a shareholder becoming dominant at Le Monde.
"We have no immediate need for an emergency recapitalisation, which would reduce the power of the staff in an unacceptable way and which would threaten the independence of the group."
In the short term, Fottorino may be right. The paper’s immediate cash drought has been watered with the €91m sale of sibling title Journaux du Midi.
But the next five years will see Le Monde shooting hazardous financial rapids, with convertible loan repayments due to its minority shareholders of €5m in 2008 and €70m in 2012.
The centre-left newspaper, founded in 1944 with the support of  General Charles de Gaulle, has remained independent while most rivals have fallen to hands-on proprietors, several of whom are close to the centre-right president of France Nicolas Sarkozy.

Data sourced from Financial Times; additional content by WARC staff