French government: "Don't even think about it"

How can those mal-bouffe junkies of Americans dare think they will ever get a chance to buy a Frrrrrrrench fleuron?

Free markets, French style. (Emphasis mine)

France's employment minister Jean-Louis Borloo said the French government is ready to 'do all' to shield Groupe Danone from a hostile takeover bid.

Danone is thought to be in the sights of PepsiCo Inc, despite assurances by the US group it has not yet built a stake in the food giant.

Speaking on Europe 1 radio Borloo said he does not want to 'confirm what is only a rumour.'

Danone shares rose sharply in opening trade today after an overnight report in the FT claimed PepsiCo has appointed banks to advise it on a bid.

Borloo said he can 'guarantee you we are looking at this matter' in the context of using unspecified means, not related to government, 'in order to try to fight against any hostile bid.'

Danone 'is more than a jewel', it is a 'special company because it is the product of our agricultural system' and a bulwark of small French businesses which supply it, Borloo said.

Borloo, whose government is imperilled by persistent high unemployment said Danone is 'a very important company for the stability of our country in terms of employment, land use, health and the 'art of (good) living.'

According to La Tribune, Danone's statutes state that any investor holding under 66 pct of group stock is limited to 12 pct of its voting rights, implying a 34 pct bloc could suffice to discourage a buyer.

Furthermore, Danone is the owner of financial services group Alfabanque and in order to alter the ownership of a financial group in France, a request must be made to the CECEI banking regulator.

The request must be made at least 10 days ahead of an offer being lodged and CECEI can take up to three months to make its decision.

MORE: Will Danone have to take the Pepsi challenge?

QUELLE horreur! France woke up yesterday to the prospect of Danone, the quintessential French dairy company, falling under American ownership.

Imagine Chevrolet buying Citroën or Americans running the Louvre. The image was cited by one broker to explain the alarm in the Paris establishment yesterday over the prospect of PepsiCo taking over Danone, a name that is almost French for yoghurt.

Shares in Danone, which also owns the Evian mineral water brand, rose more than 13 per cent yesterday as markets gave credit to rumours that the American food and drink giant is about to pounce on one of the symbols of Gallic success. The French state is unhappy and is expected to help Danone to mount a defence.

“I am furious,” said Patrick Ollier, an MP in President Chirac’s Union for a Popular Majority who heads the Parliament’s economic affairs committee. He said he was “very worried at the thought that Danone could pass under the control of Pepsi-Cola”.

Thierry Breton, the Finance Minister, was also concerned and was following the affair closely, M Ollier said.

(...)

“The Danone culture cannot be bought,” Franck Riboud, the company’s president and son of Antoine Riboud, its founder, recently told a corporate meeting, according to Les Echoes, a business newspaper.