Thales CEO succession stalled as shareholders split: sources

Mon Dec 22, 2014 9:16am EST
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By Cyril Altmeyer

PARIS (Reuters) - Thales' (TCFP.PA: Quote) top shareholders are at odds over its plan for a dual leadership structure that may change their influence at the French defense electronics maker, sources familiar with the matter said on Monday.

The disagreement between the French government, Thales' top shareholder with 26 percent, and Dassault Aviation (AVMD.PA: Quote), which holds 25 percent, has prompted the company to postpone a board meeting scheduled for Monday, the sources said.

The board had been expected to replace outgoing chairman and chief executive Jean-Bernard Levy with former EDF (EDF.PA: Quote) boss Henri Proglio as non-executive chairman and Levy's second-in-command Patrice Caine as CEO.

The arrival of Proglio and Caine would require changes to the composition of the board, with the French state calling on Dassault to give up one of its seats to make room for Proglio, the sources said.

Dassault is refusing, however, as the loss of one of its four seats would create an imbalance in the face of the government, which would keep five, one of the sources said. Thales' board has 16 members in total.

"In a way, the fact there is a discussion on this precise point means that we're starting again from scratch," one of the sources said.

"There isn't a discussion on the choice of Henri Proglio as such, but the problem of the composition of the board of directors could bring into question his nomination, and indirectly that of Patrice Caine."

The issue may now not be resolved before January, the sources said.   Continued...

The logo of French defence and electronics group Thales is seen on the building of the company's headquarters in Neuilly, near Paris,  May 20, 2008.   REUTERS/Charles Platiau