Tour de France: for sale?

Wednesday, 28 April 2010

Background
Lagardère is a French company with a focus on media interests. It owns 20% of French satellite TV channel Canal+ as well as other print interests, like newspaper Le Monde. It’s the world’s largest magazine publisher, via its subsidiary Hachette-Filipacchi. Run today by Arnaud Lagardère, the company is now coming under pressure from certain shareholders to improve its profitability. One new shareholder is a US investor with a reputation for turning around sleepy companies.

Shake up
One consequence of this shareholder activism seems to be a review of the assets and it looks possible that the holding in Canal+ could be up for sale. Interestingly, the proceeds of this sale could go towards the acquisition of Amaury, the French company that owns newspapers like Le Parisien, L’Equipe as well as Amaury Sport Organisation (ASO), the organiser of the Tour de France, as well as several other sports events like Paris-Dakar and the French Open (golf).

New Strategy
Lagardère already owns 25% of Amaury but feels that it needs to take a position that can be summed up as “all or nothing”, for example it can’t buy Canal+ so it’s putting up the stake for sale. But it wants to expand its 25% holding in Amaury to acquire the whole company. Whether this will happen is another matter.

Will Amaury sell?
Amaury is held by the Amaury family and it seems they reluctant to sell. But Lagardère is already involved in the sports world, buying up sports rights and image rights, it is a rival to ASO. Lagardère is already overweight in the print media sector, an area where few see growth or fat profits.

Let’s speculate
Instead image rights and sports organisation could be exactly what Lagardère needs. So instead of taking the whole business from the Amaury family, it could be a deal is struck to sell ASO to Lagardère, meaning the Tour de France would lose its historic links to L’Equipe and its predecessor, L’Auto. You heard it here first.

What would change?
I’m not sure if anything would change. The Tour is already run on an intensely commercial basis and this has been so from the start, it was created to sell newspapers and today this has translated into the sale of TV rights. Perhaps Lagardère would accelerate this, maybe inviting more foreign teams? But Amaury/ASO is a conservative organisation with close political links to several centre-right politicians in France and Lagardère is exactly the same, it is impeccably, even suspiciously, well-connected. One amusing thing would be to see Le Monde forced to report on the Tour de France, it has in the past refused to publish the results from the race claiming it was no longer fit for the sports pages and merely a contest between doctors and pharmaceutical labs.

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