Le Monde board to rule on competing bids for controlling stake in French newspaper

Le Monde board to choose bidder

PARIS — The supervisory board for France’s Le Monde is meeting Monday to choose new owners for the iconic but debt-saddled newspaper — owners who will take control out of the journalists’ hands for the first time since 1951.

The journalists’ committee that oversees strategic choices at Le Monde overwhelmingly backs a bid by a business trio formed by Internet billionaire Xavier Niel, Lazard banker Matthieu Pigasse and Pierre Berge, an arts patron and longtime partner of the late designer Yves Saint-Laurent.

A rival bidder, a group that includes the owner of Spain’s El Pais and France’s former state telecoms monopoly, said hours before the meeting that it would pull out.

Le Monde says it needs help to pay off debts and survive punishing times in the media industry and is looking for an estimated €100 million ($124 million) capital increase. Le Monde needs the cash fast and would become bankrupt at the end of June if it doesn’t receive new capital, spokeswoman Anne Hartenstein said.

France’s telecoms giant, Orange, which made a joint bid with the French Nouvel Observateur magazine and the Spanish group Prisa, owner of El Pais, issued a statement Monday to announce the group would not maintain its offer after the journalists’ committee favored the other bid by 90 percent.

The supervisory board meeting Monday is to choose to enter exclusive talks with a bidder, conditional on a deposit of €10 million. It is widely expected to select the business trio, known by the acronyms of the three men’s last names: BNP.

The journalists said in a statement Friday they chose the trio’s bid because it was “the most coherent proposition.” The statement said the bidders had pledged to allow journalists to keep a minority veto voting right on the board — which should guarantee the newspaper’s editorial independence.

Still, Le Monde’s takeover “marks the end of an era,” said Thierry Dussard, a media management professor at Sciences Po, the Institute of Political Studies in Paris.

“Reality and capitalism have now caught up with the French press,” said Dussard, who described Le Monde as “the last dinosaur” where journalists ran their newspaper regardless of capital ownership or profits.

“It’s the swan song for the journalists’ independence,” he said.

To date, the Le Monde holding has been controlled by an odd blend of internal shareholders, mainly journalists, and minority outsiders with decreased voting rights.

French media reported that conservative French President Nicolas Sarkozy tried to weigh in on Le Monde’s takeover, favoring the bid led by Orange, in which the French state maintains a majority stake. Critics accused him of meddling with the media to find a more docile owner for Le Monde, which has a strong history of independence, before 2012 presidential elections.

Dussard, the analyst, said the journalists’ committee choice was “a clear anti-Sarkozy reaction,” because a deal with the Internet giant could have been very beneficial for Le Monde and its website.

Founded in 1944 after much of the French press had been discredited for collaborating with the Nazis who occupied France during World War II, the center-left Le Monde has been controlled by its journalists for decades. But a series of hazardous business ventures and long-declining readership figures have left the daily struggling for cash.

Le Monde’s readership is slightly smaller than center-right rival Le Figaro, with 318,000 copies sold daily on average in 2009, according to the OJD media monitoring association.

While previous capital increases allowed the journalists to retain control, Monday’s decision is expected to lead to the newspaper’s de-facto takeover. The bid’s exact financial and legal conditions will be known after the supervisory board meeting.