Family Feud Threatens Publicis

A court dispute among the descendants of late Publicis founder Marcel Bleustein-Blanchet could dissolve the family holding company that controls nearly half of the voting shares of Groupe Publicis S.A.
Michle Bleustein-Blanchet filed suit Oct. 7 seeking to dissolve Somarel, the closed family Publicis holding company. She went public with her intent to sell her shares last May, but was thwarted by her sister, Elisabeth Badinter, who owns a larger share of Somarel. Bleustein-Blanchet claims the bylaws of Somarel prevent her from disposing of her stock unilaterally.
If Bleustein-Blanchet succeeds in entirely divesting her shares in Somarel and those held directly in Publicis, it would result in the Bleustein-Blanchet family losing majority ownership of the agency.
According to Bleustein-Blanchet, Badinter has absolute control of Publicis with 52 percent of the voting rights in the group, thanks to the Somarel structure that Bleustein-Blanchet charges is illegal.
Taken together, the family owns 62 percent of Publicis’ stock either directly or through the Somarel holding. The remaining 38 percent of Publicis stock is publicly traded on the Paris stock exchange.
For her part, Badinter owns 7 percent of quoted Publicis stock and 33.38 percent of Somarel. The remainder of Somarel is controlled by other survivors of Marcel Bleustein-Blanchet.
Further complicating matters, Badinter was named chairwoman of the Publicis S.A. supervisory board last April, bestowing on her additional authority over the operations of the group. Her appointment was made following the death of her father and was unanimously agreed upon, including by her sister Michle, who is also a member of the board. Badinter declined to comment on the lawsuit.
Maurice Lƒvy, chairman and CEO of Publicis, also declined to comment on reports that he alone, or leading a group of investors, may be interested in purchasing some or all of the shares currently controlled by Bleustein-Blanchet. Publicis sources also would not comment on reports [Adweek, Aug. 11] that Bleustein-Blanchet was in negotiations with Mercury Asset Management in London, which holds around 5 percent of Publicis’ publicly traded stock, a stake said to be the largest non-family position in the company.