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:: Comments to Bloomberg about Jean-Luc Lagardere ::

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Teal's Aboulafia Comments on Jean-Luc Lagardere's Industry Role
2003-03-14 08:21 (New York)


Washington, March 14 (Bloomberg) -- Following are comments
from Richard Aboulafia, vice president at Fairfax, Virginia-based
Teal Group consulting company, about Jean-Luc Lagardere's role in
French aerospace and his son Arnaud's future in the industry.
Lagardere, the founder and chairman of Lagardere SCA,
France's second-biggest media company, is in ``critical
condition'' in a Paris hospital, the company said. Lagardere, 75,
was hospitalized last weekend to treat a viral infection developed
after undergoing hip surgery.
Lagardere SCA owns 15 percent of European Aeronautic, Defense
& Space Co., the 80 percent owner of planemaker Airbus SAS.
Aboulafia spoke in a phone interview.

"Lagardere represented reform. He started it all out by
reforming Aerospatiale Matra,'' an aerospace company formed in
1999 by the merger of France's state-owned Aerospatiale and
Lagardere's Matra military and aerospace division.
The merger "had a huge transformational effect on
Aerospatiale. Aerospatiale until then was almost para-socialist.
Matra brought new free-market ideas and basically represented the
future. He brought it kicking and screaming into the 20th century.
"Lagardere was a catalyst for the French aerospace industry
to enter the modern world. French aerospace had been dominated by
closely held and government-held assets. It was Lagardere who
pushed openness, and brought reform, basically.
"European Aeronautic, Defense & Space Co. might not exist
today if it hadn't been for Lagardere, because the Germans would
never have had common ground with a pre-Matra Aerospatiale.
"We don't know what will happen with Lagardere's share in
EADS if Lagardere dies. Lagardere had a strong emotional,
historical commitment to the company. He was largely responsible
for its very existence.
"We don't how his son will feel about EADS. He might regard
this as a strictly return-on-investment situation and, given the
state of the industry, it might be a difficult case to make to
hang onto EADS. It really depends on what kinds of options they
have.
"The most likely scenario is that they'll stay the course
just because things are mediocre now, but it does introduce an
element of risk and that's never good. This is an extremely
crucial year ahead for EADS with declining revenues and increased
spending.''

--Andrea Rothman in Toulouse, France, (33) 5 6365 7668 or
arothman@bloomberg.net. Editor: Lavell.

 

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