From: ABC.Service.Langues@skynet.be   
      
   Kanter James, A French citadel?, IHT 01/09/05   
      
      
      
   PARIS: After recent vocal efforts by governments in France to defend   
   flagship companies from foreign bidders. French officials on Wednesday   
   started sketching concrete plans to protect companies deemed strategie, but   
   they left unclear how the plans would pass muster with European regulators   
   or re­assure skittish investors.   
      
   Finance Minister Thierry Breton said the government pIanned a new le­gaI   
   buIwark to protect "very sensitive sectors" of the economy including   
   de­fense, biotechnology. space and tele­communications. According to Budget   
   Minister Jean-François Copé. the new measures will fully comply with the   
   terms of French membership in the European Union's single market.   
      
   The moves show the French govern­ment attempting to shore up its pop­ularity   
   as fears grow over the fIight of jobs to low-cost labor markets in East­ern   
   Europe.   
      
   Prime Minister Dominique de Villepin, who took office this year, bas made   
   the defense of French manufac­turing one of his raIlying caIls after   
   specuIation this summer that the Amer'­ican company PepsiCo could bid for   
   the dairy giant Danone, a popular house­hold brand in France and a huge   
   pur­chaser of French dairy and agricultural goods.   
      
   European regulators said they wanted to review the French plan.   
      
   The measures are "important enough that the commission will proactively   
   follow this matter," said Gregor Kreuzhuber, a spokesman for the European   
   Commis­sion. "VIe don't want to see disguised pro­tectionism. .   
      
   Kreuzhuber said French officials had aIready told officiaIs in BrusseIs that   
   the measures would not be specifically tar­geted at the agro-food sector to   
   prevent a takeover of Danone.   
      
   The French newspaper Les Echos published a list on Wednesday of 10 sec­tors   
   under consideration, including de­fense, information technology and   
   casi­nos. That report could not be confmned; a spokeswoman for   
   Indus­tryMinister François Loos did not re­tum a call from the International   
   Her­ald Tribune.            ­   
      
   Legal experts say winning approval for the new measures could be a delic­ate   
   matter.   
      
   Private investment firms are likely to be among the businesses irritated by   
   what French govemment officiaIs have called "economic patriotism." With   
   ac­cess to cheap borrowed cash, the firms have increased their activities in   
   France in recent years, with Kohlberg Kravis Roberts buying the electrical   
   supplies company Legrand and Texas Pacifie Group taking a stake in Gemplus,   
   the maker of French smart cards.   
      
   For more casual investors in French companies, the moves could drag down   
   share values. Companies with share priees that carry a premium because they   
   could be takeover targets in the fu­ture could lose that added value with   
   the prospect of few mergers and acqui­sitions, said Brian Rafferty, the   
   man­aging director of a New York-based in­vestor relations finn,   
   TaylorRafferty.   
      
   Even so, Rafferty cautioned that sharp share price moves after   
   impIe­mentation of the measures was un­likely. "Codifying the way France bas   
   approached business shouldn't make such a big difference to the way the   
   in­vestment community bas seen France from some time, " be said.   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)