Levy helps Publicis end boardroom battle over shares

Senior managers of the Publicis network are poised to become shareholders after the settlement of a bitter boardroom battle between the daughters of the group’s late founder that had threatened to spill over into the courts.

Senior managers of the Publicis network are poised to become

shareholders after the settlement of a bitter boardroom battle between

the daughters of the group’s late founder that had threatened to spill

over into the courts.



The agreement between Michele Bleustein-Blanchet and Elisabeth Badinter

will allow share option schemes to be created for executives.



But while the deal ensures that the group remains under the control of

the Bleustein-Blanchet family, it will also turn Michele into one of

France’s richest women, worth an estimated pounds 100 million, when she

disposes of her shareholdings.



At the same time, it gives Maurice Levy, the Publicis chairman, control

over a large proportion of the group’s shares with which to incentivise

employees.



The ownership of Publicis was thrown into question last year when

Michele said she was selling her shares, held directly and indirectly

via her stake in the Publicis holding company, Somarel.



The disposal of her 20 per cent interest on the open market threatened

to upset the complex family trust system put in place by Marcel

Bleustein-Blanchet, who died in April 1996, to ensure the family

remained in control of Publicis and to protect its independence. The

family currently owns 62 per cent of Publicis’s stock. The rest is

traded on the Paris stock exchange.



When Badinter, as chairman of the Publicis supervisory board, blocked

the sale, Michele filed a lawsuit seeking to dissolve Somarel.



As a result of negotiations conducted by Levy, both Michele and Nicolas

Rachline, another investor, will dispose of a total of 44.52 per cent of

Somarel shares.



Meanwhile, Badinter bolsters her control of the company by bringing her

total interest to 40.78 per cent.



Somarel changes its status from a private to a public company with 37.1

per cent of its capital shared equally by MLMS, a new company formed to

facilitate employee shareholding, and institutional investors.



Levy said the agreement reinforced Publicis’s independence and

encouraged ’even more personal involvement by the people at the heart of

our enterprise’.



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