Welcome to the New Havas. With good reason, 1998 has been
proclaimed as a turning point in the history of France’s oldest and
largest communications group. In March, its most powerful shareholder,
Compagnie General des Eaux, took full control in a deal valuing Havas at
dollars 6.5 billion. And perhaps predictably, its veteran chairman,
Pierre Dauzier, stepped down soon after to be replaced by one of his
former lieutenants, Eric Licoys.
Turning point it may well be, but as to the new direction, so far there
have been a lot more questions than answers. In the feverish atmosphere
that accompanied the run-up to the deal, many mid-ranking Havas
executives were speculating that CGE - principally an engineering and
utilities company - was primarily interested in the group’s media
Financial analysts tended to agree. The consensus was that the company’s
advertising interests, including Euro RSCG and the Campus network, would
soon be on the block.
Not so. On completing the takeover, the first act of CGE chairman,
Jean-Marie Messier, was to guarantee the future of that side of the
’Not one share of Havas Advertising is for sale. It will remain part of
the group and provide an excellent window to what consumers want in our
other activities,’ he said. And Licoys added: ’Havas Advertising has all
For some, this had all the reassurance of a football club chairman’s
vote of confidence. But Havas continues in its own paradoxical fashion,
with feet on both sides of the fence dividing media buyers from media
Outside of Japan, this is unique; and to an Anglo-Saxon mind-set,
somewhat suspicious. The Havas line is that it can be Number One at
everything, but critics maintain that its dual focus is a liability.
But this isn’t the group’s only long-term problem. For many years, its
main media strategy was to place itself at the heart of European
broadcasting via its shareholding in Canal Plus, the world’s leading
pay-TV company, and its influential stake in CLT, Europe’s most powerful
A couple of years back, one half of this two-pronged strategy fell apart
when CLT decided to turn its back on France and merge with UFA, the
broadcasting division of Germany’s Bertelsmann. Although Havas retained
a significant shareholding in one of CLT-UFA’s parent companies, it held
very little influence. But so what? It still had Canal Plus.
Not now it doesn’t. Back in April, it was made clear by CGE that it was
to strip out the Canal Plus shareholding and manage it as a separate
The timing was somewhat unfortunate, given that a number of disposals
agreed last year are currently going through, including, most notably,
IP, the biggest media sales house in Europe. These disposals and the
loss of Canal Plus mean that Havas has more than halved in size
virtually overnight. Before the CGE deal, the annual turnover of all of
its divisions totalled over FFr51 billion. Now it comes to around FFr20
billion. As dust settles on the takeover, it’s becoming more apparent
that Havas is now left with a disparate collection of poster and
So the big question is: where to now? Middle management, although
thoroughly confused at present, believe that recent history can be put
There has been speculation, for instance, that Havas will attempt to buy
back IP - unlikely, since it was sold to CLT-UFA, whose TV stations
provide a huge proportion of IP’s inventory.
Licoys has a more prosaic vision. ’The priority of Havas is to look for
alliances and acquisitions in professional publications,’ he stated in
March. Recently he entered exploratory talks with Bertelsmann’s
professional publishing division and there have also been rumours of
discussions with the Dutch trade and technical publishing group, VNU.
Not so long ago, Havas saw itself as a multimedia player in the Time
Warner league. The new role model would appear to be Reed Elsevier.
Meanwhile, the search is on to find a viable long-term role for Havas
Advertising. The underlying problem is, as ever, how to join the big
league of global agency networks. Euro RSCG is at the top of the table
in Europe and has made good progress in the States. But CGE believes the
time is right to forge a partnership with a major UK or US group. And
it’s in a hurry, wanting to see the issue resolved by the end of the
There’s a touch of deja vu about this. In the late 80s, the group
entered a tripartite alliance to create the unwieldy and short-lived
Havas Dentsu Marsteller. But the Havas Advertising chairman, Alain de
Pouzilhac, is confident that he can now find a ’complementary’ partner.
Saatchi & Saatchi, DMB&B, Leo Burnett and Grey have all been mooted.
Which brings us back to square one. If Messier’s statement is to be
taken at face value, that means that Havas Advertising is looking at a
major acquisition. Unlikely? Perhaps, but far from impossible. CGE,
after all, has extremely deep pockets.