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Serge Dassault’s legacy under threat by succession and scandal
February 3, 2014 1:39 pm
©BenoitTessier/Reuters
Serge Dassault is an 88-year-old powerhouse of the French business establishment, a senator who not only controls the country’s leading rightwing newspaper but also the national aerospace and defence champion.
He is the son of the industrialist and second world war resistance fighter Marcel Dassault, and his expansion of his family’s business empire over the past two decades has given him a substantial voice in politics and the defence sector.
But the octogenarian, though still tough-talking and influential, is facing an ever-growing list of personal problems, including planning who should succeed him and dealing with allegations of vote rigging in his old mayoral district.
The issues threaten the legacy of one of France’s great industrial families, but also the future of Dassault Aviation, maker of the Rafale and Mirage jets, which is majority controlled by the Dassault Group.
The most high-profile issue around Mr Dassault is the mounting investigation into vote-buying and attempted murder in Corbeil-Essonne, a working-class commune in a southern suburb of Paris, where he was mayor from 1995 to 2009.
Dassault was stripped of his mayorship in 2009 after France’s highest administrative court found that he had made cash gifts to voters that could have affected the outcome of the mayoral election.
Late last year a former associate of Mr Dassault, Younès Bounouara, was arrested and put under investigation for the attempted murder of a 32-year-old amateur boxer, with police investigating the idea that the attack was related to the vote-buying scandal.
The lawyer for Mr Bounouara has rejected the allegation that the shooting was intentional. Mr Dassault has always denied fraudulent vote buying in his district and any involvement in the shooting.
Dassault has immunity from prosecution as a serving senator, meaning he cannot be taken into police custody for official questioning, but the expanding police investigation creates damaging publicity for himself and his family.
The second problem, which insiders say more directly affects the future of the media, defence and also wine-growing empire, is that of family succession – a twisted saga that has long fascinated the French establishment.
The concern for Serge is that his empire will fall apart after his death amid disputes between his four children, according to people familiar with the family situation, and he has recently been taking steps to smooth the transition.
The two eldest of his four children – Olivier and Laurent – have long been in competition with each other and are thought to be frontrunners for the title of head of the Dassault Group.
Olivier is described on his own blog as a “politician, entrepreneur, experienced pilot, popular photographer and a recognised composer”. His rival and brother Laurent is described more simply as “an intrepid polo player”.
Serge has in the past expressed doubts over whether any junior family members were “competent” enough to take over. But later he said that Olivier, his eldest son, was “far more appropriate” than his other two sons and daughter.
Serge has organised a committee of “wise men” to help steer the eventual transition, a sign that the issue is very much on his mind. It is likely that one person will be appointed to the job rather than a power-sharing arrangement.
The final issue for Serge Dassault is the problems faced by Dassault Aviation amid the global slowdown of defence spending. France has cut its orders for Rafale jets from 66 to 26. Meanwhile, negotiations with India over a potential order for 189 jets – so far its only export success – are still bogged down after more than two years.
Fortunately for Dassault Aviation it is not completely reliant on defence, taking two-thirds of its revenues from its strong business jets unit last year. Revenues in the third quarter rose 29 per cent to €762m.
Because of this, however, there are questions about the future of the defence side of the business, with speculation it could form part of a broader consolidation in the sector, possibly combining with other French groups such as Thales or Safran.
Laurent Dassault spoke last year about the possible creation of a “France Aerospace” through a tie-up between Dassault, Thales, Safran and perhaps Zodiac Aerospace.
This idea was quickly rebuffed by all the companies, however, but consolidation remains a question for the future of Dassault Aviation, Dassault Group and the Dassault industrial family.
Serge Dassault’s legacy under threat by succession and scandal - FT.com
February 3, 2014 1:39 pm
Serge Dassault is an 88-year-old powerhouse of the French business establishment, a senator who not only controls the country’s leading rightwing newspaper but also the national aerospace and defence champion.
He is the son of the industrialist and second world war resistance fighter Marcel Dassault, and his expansion of his family’s business empire over the past two decades has given him a substantial voice in politics and the defence sector.
But the octogenarian, though still tough-talking and influential, is facing an ever-growing list of personal problems, including planning who should succeed him and dealing with allegations of vote rigging in his old mayoral district.
The issues threaten the legacy of one of France’s great industrial families, but also the future of Dassault Aviation, maker of the Rafale and Mirage jets, which is majority controlled by the Dassault Group.
The most high-profile issue around Mr Dassault is the mounting investigation into vote-buying and attempted murder in Corbeil-Essonne, a working-class commune in a southern suburb of Paris, where he was mayor from 1995 to 2009.
Dassault was stripped of his mayorship in 2009 after France’s highest administrative court found that he had made cash gifts to voters that could have affected the outcome of the mayoral election.
Late last year a former associate of Mr Dassault, Younès Bounouara, was arrested and put under investigation for the attempted murder of a 32-year-old amateur boxer, with police investigating the idea that the attack was related to the vote-buying scandal.
The lawyer for Mr Bounouara has rejected the allegation that the shooting was intentional. Mr Dassault has always denied fraudulent vote buying in his district and any involvement in the shooting.
Dassault has immunity from prosecution as a serving senator, meaning he cannot be taken into police custody for official questioning, but the expanding police investigation creates damaging publicity for himself and his family.
The second problem, which insiders say more directly affects the future of the media, defence and also wine-growing empire, is that of family succession – a twisted saga that has long fascinated the French establishment.
The concern for Serge is that his empire will fall apart after his death amid disputes between his four children, according to people familiar with the family situation, and he has recently been taking steps to smooth the transition.
The two eldest of his four children – Olivier and Laurent – have long been in competition with each other and are thought to be frontrunners for the title of head of the Dassault Group.
Olivier is described on his own blog as a “politician, entrepreneur, experienced pilot, popular photographer and a recognised composer”. His rival and brother Laurent is described more simply as “an intrepid polo player”.
Serge has in the past expressed doubts over whether any junior family members were “competent” enough to take over. But later he said that Olivier, his eldest son, was “far more appropriate” than his other two sons and daughter.
Serge has organised a committee of “wise men” to help steer the eventual transition, a sign that the issue is very much on his mind. It is likely that one person will be appointed to the job rather than a power-sharing arrangement.
The final issue for Serge Dassault is the problems faced by Dassault Aviation amid the global slowdown of defence spending. France has cut its orders for Rafale jets from 66 to 26. Meanwhile, negotiations with India over a potential order for 189 jets – so far its only export success – are still bogged down after more than two years.
Fortunately for Dassault Aviation it is not completely reliant on defence, taking two-thirds of its revenues from its strong business jets unit last year. Revenues in the third quarter rose 29 per cent to €762m.
Because of this, however, there are questions about the future of the defence side of the business, with speculation it could form part of a broader consolidation in the sector, possibly combining with other French groups such as Thales or Safran.
Laurent Dassault spoke last year about the possible creation of a “France Aerospace” through a tie-up between Dassault, Thales, Safran and perhaps Zodiac Aerospace.
This idea was quickly rebuffed by all the companies, however, but consolidation remains a question for the future of Dassault Aviation, Dassault Group and the Dassault industrial family.
Serge Dassault’s legacy under threat by succession and scandal - FT.com
