EADS Executives Defend Themselves at Board Meeting
The head of French media group Lagardere survived a challenge to his seat on a new board at Airbus parent EADS on Monday despite calls from minority shareholders that he should step down.
EADS won shareholder backing for a new 11-member board including four independent directors as it seeks a clean break from past management in-fighting blamed for slowing its response to growing competition from rival Boeing.
Arnaud Lagardere was challenged by two minority shareholder groups over his company's decision to sell shares in EADS last year before Airbus's announcement of a costly delay in the A380 superjumbo sent EADS stock tumbling.
German automaker Daimler decided to reduce its EADS stake at the same time that Lagardere and others, including past and present EADS executives, also sold shares.
All sides have denied any wrongdoing related to the sales, which are now the subject of investigations by French and German authorities.
A preliminary report to prosecutors by France's stock market regulator AMF outlining "concurrent and massive" dealings caused a storm when it was leaked in the French media early this month.
Lagardere, who faces a parliamentary panel hearing on the matter on Thursday, betrayed frustration at what has become an increasingly Byzantine political scandal in France, marked by what he called "relentless attacks" on EADS.
"As long as Lagardere (group) remains a shareholder, I will stay," Lagardere said. "I will give up nothing and I will remember everything."
Growing Global Reach
EADS management faces several pressing challenges, including its Power8 cost-saving programme, which is under pressure as the dollar weakens further.
The board's new independent members include Lakshmi Mittal, chairman and chief executive of the world's largest steelmaker, ArcelorMittal.
Mittal's appointment underscored the company's growing global reach, EADS Chairman Ruediger Grube told shareholders.
His appointment to the helm of a company which makes French missiles, as well as European rockets, helicopters and airliners, is seen as a rehabilitation in France where he was subjected to personal attacks when bidding for Arcelor.
Despite building up stakes in the company, investors in Qatar and Russia did not win seats on the board.
Lagardere and Daimler retained two seats each and key banks Deutsche Bank AG and BNP Paribas each secured a position as the company's traditional balance of French and German managerial power was maintained.
EADS, which earlier scrapped a system of two CEOs and two chairmen, sees its latest board line-up as a further step toward streamlining its management, EADS CEO Louis Gallois said.
"The fact we were two CEOs created two camps, one French and one German. Now it's finished," Gallois said.
Lagardere agreed to step down as co-chairman of EADS under a restructuring adopted at a Franco-German summit in July.
He secured reappointment to the board despite anger over comments he had made in which he said he would rather be thought of as incompetent than dishonest regarding the A380's delay.