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DISPARITION - Le légendaire créateur au nœud papillon qui avait ranimé la vénérable maison de couture Lanvin au début des années 2000, est décédé des suites du Covid-19, samedi 24 avril.

Il avait accordé en janvier dernier, un long entretien au Figaro à l'occasion du lancement de sa nouvelle marque AZ Factory. Depuis son départ de la maison Lanvin cinq ans auparavant, il avait plus ou moins disparu des radars de la mode. Pourtant, son retour avait été unanimement applaudi, et sa joie de vivre, son regard lucide et bienveillant sur l'industrie, ses aphorismes sans langue de bois étaient restés intacts. C'est pourquoi ses nombreux fans ont appris la nouvelle de sa disparition, ce week-end, avec stupeur. Alber Elbaz, le légendaire créateur au nœud papillon, est mort des suites du Covid-19, ce samedi 24 avril, à l'âge de 59 ans.

À LIRE AUSSI :Alber Elbaz: «Une couture à ma manière, “my way”…»

«J'ai perdu non seulement un collègue, mais aussi un ami bien-aimé, déclarait dans un communiqué, Johann Rupert, président de Richemont, le groupe avec lequel Elbaz s'était associé en 2019 pour lancer sa griffe. Alber avait la réputation bien méritée d'être l'une des personnalités les plus brillantes et les plus appréciées du secteur. J'ai toujours été séduit par son intelligence, sa sensibilité, sa générosité et sa créativité débridée. C'était un homme d'une chaleur et d'un talent exceptionnels, et sa vision singulière, son sens de la beauté et son empathie laissent une impression indélébile.» Les nombreuses réactions à sa disparition confirment l'immense affection que lui portaient ses pairs. À l'instar de Maria Grazia Chiuri, la créatrice de Dior, qui nous confiait, hier: « Alber était un ami, avant même d'incarner l'extraordinaire talent créatif qui nous a donné une interprétation cultivée, féminine, amusante et humaine du glamour. Il était avant tout une personne empathique et généreuse : son mot préféré était 'amour', et sa perte est pour moi une grande douleur.» Même tristesse pour son successeur aujourd'hui chez Lanvin, le Français Bruno Sialelli: «Je suis très attristé par la disparition d'Alber Elbaz pour qui j'ai un immense respect. Son héritage, sa générosité et son amour continueront d'exister au travers de la maison Lanvin.» Pour Gabriela Hearst, directrice artistique de Chloé (également propriété du groupe Richemont), «Le véritable élan d'amour qui se manifeste dans notre secteur est un témoignage de sa générosité. Nous avons perdu un talent inclusif, aimable et exceptionnel. Un exemple de la façon dont nous devrions nous traiter les uns les autres.»

Repéré par Pierre Bergé

Alber Elbaz naît en 1961 à Casablanca, au Maroc, puis grandit à Tel-Aviv où il commence très jeune à dessiner des robes. En 1982, il entre au Shenkar College, l'école de mode et de textile de la ville israélienne. Après son service militaire, il s'envole pour New York où il devient le bras droit du couturier Geoffrey Beene. En 1996, il est choisi pour reprendre la direction artistique de Guy Laroche à Paris. Son talent est aussitôt repéré par Pierre Bergé qui, en novembre 1998, le désigne comme successeur d'Yves Saint Laurent à la tête du prêt-à-porter Yves Saint Laurent Rive Gauche. Mais après trois saisons, la maison est rachetée par Gucci Group qui nomme Tom Ford à sa place.

À LIRE AUSSI :Alber Elbaz : "Il n'y a rien de plus déprimant que la perfection"

S'il s'octroie une année sabbatique, c'est pour mieux revenir, en 2001, en tant que directeur artistique de Lanvin. Sous son règne, la plus ancienne maison de couture parisienne va connaître un nouvel âge d'or, notamment aux États-Unis où les clientes plébiscitent ses robes de cocktail et sa Parisienne cérébrale et sophistiquée. « Nous avons vécu là-bas une grande aventure, se remémore Elie Top, son ancien assistant chez Yves Saint Laurent et à qui il confie les rênes de la joaillerie chez Lanvin. C'était une expérience stimulante, au cours de laquelle nous étions tous galvanisés par l'admiration commune vouée à Alber, à son talent solaire, généreux. Il faisait preuve de génie, et, surtout, savait emmener ses troupes. Tout le monde était derrière lui, avec la sensation de faire partie d'une épopée.»

Alber Elbaz

Génie de la couture, obsédé par la féminité, le confort et le désir, il habillera les célébrités, de Meryl Streep aux Oscar en 2012, à Nicole Kidman, Gwyneth Paltrow et Catherine Deneuve. Mais surtout, il provoquera des standing-ovation lors de ses défilés devenus des rendez-vous incontournables de la Fashion Week de Paris. « Peu de créateurs parvenaient à faire pleurer le public au passage d'une robe, rappelle Elie Top. Il travaillait vraiment pour les femmes. On ne parlait plus de mode devant ses créations, mais d'une forme de beauté à nu, de vérité pure, qu'il donnait à voir.» Babeth Djian, sa collaboratrice de toujours au stylisme des défilés, complète : « Il travaillait dans la joie et dans l'amour, dans l'humour et la passion, avec toujours une dose d'exubérance. Il avait des étoiles dans les yeux. C'était un homme au talent magistral, à la liberté et à la créativité incroyables. Un des plus grands créateurs au sens noble du terme. Il était l'allié des femmes, de toutes les femmes, les sublimait et voulait toutes les rendre belles.»

Le succès de ses collections, sa personnalité attachante ont fait de lui une star de la mode. Son allure, qui inspirera le logo d'AZ Factory, le rend reconnaissable entre mille : nœud papillon, grosses lunettes, visage poupon. «Ma mère me disait : 'Sois petit et grand ; grand dans ton travail mais petit dans ta vie, sois simple, sois humble.'», racontait-il. En 2008, Le Figaro écrivait déjà à son sujet: «Elbaz fonctionne à l'humain, à l'empathie, au contact. Lui dit qu'il aime les gens, qu'il n'aime que ça, qu'il ne collectionne rien si ce n'est les lettres qu'on lui adresse. Son monde ignore les textos et l'ordinateur. Sur ses joues rondes, il splashe un parfum sucré, un mélange oriental et musqué, ultrasensuel, un élixir qui rend fou, qui vous colle à la peau après que vous l'avez embrassé. Façon comme une autre de laisser une trace de lui, un sillage qui s'accroche aux autres.»

Durant ses presque quinze ans chez Lanvin, il projette la maison dans la pop culture, dessinant des timbres de La Poste, rhabillant une ligne de maquillage pour Lancôme et une robe pour Minnie Mouse. Mais après son départ chaotique en 2015, il prend du recul, signant tout de même une poignée de collaborations, avec les Éditions de Parfums Frédéric Malle en 2016 (qui donnera la fragrance Superstitious), Converse en 2017 ou encore, Tod's en 2019.

Une couture fun

Il y a deux ans, il annonçait son come-back avec le lancement de sa marque AZ Factory en partenariat avec Richemont. En janvier, il présentait ainsi la première collection, sa version d'une haute couture moderne, à la silhouette «fun » tournée vers les nouvelles technologies. «Je me suis beaucoup interrogé sur la question de l'âge, disait-il au Figaro, à l'occasion de son retour. Je ne me retrouvais pas dans ce monde où le designer doit avoir 16 ans et le CEO, 22 ans maximum : fais-je encore partie de cette histoire ?» S'il avait regagné sa place sur l'échiquier de la mode, il n'était pas dupe de son époque. « On vit dans un monde qui génère trop de solitude et trop d'agressivité. Un monde qui a trop de 'likes' et pas assez de 'love'. C'est le moment, je crois, de s'autoriser à être soi-même et à s'aimer.»

Break-up would allow 162-year-old UK company to focus on making healthier foods

Tate & Lyle said it was in talks to sell a controlling stake in a division that generates the bulk of its £2.9bn annual revenues, as the 162-year-old company looks to shift its focus towards healthier foods.

The FTSE 250 group said on Sunday it was in discussions with potential buyers for a majority share in its primary products arm, which makes artificial sweeteners and industrial starches, particularly for the North American market. The division reported £1.8bn in revenues in the 12 months to April 2020.

The move is designed to allow London-based Tate & Lyle to focus on its food and beverage solutions arm, which helps companies such as Mondelez and Nestlé replace sugar, salt and fats in their food products.

The company, which is led by chief executive Nick Hampton, believes splitting off its businesses will allow a greater focus on the food and beverage arm, which has higher profit margins, faster revenue growth and alignment with consumer trends for healthier living.

Tate & Lyle made the announcement after the Sunday Telegraph first reported the sale discussions. The group added that the talks were at an early stage with no certainty a transaction would be completed. 

A person familiar with the talks said Apollo Global Management and Cerberus were among those to engage in discussions to acquire a majority stake in the primary products division. The two US funds did not immediately respond to requests for comment.

Tate & Lyle is being advised by its brokers, Bank of America and Citi. 

The company, whose roots stretch back to 1859, was once a leading power in the global sugar industry, expanding along with the British empire to become a familiar household name.

It sold its sugar business in 2010 and now makes sweeteners such as stevia and sucralose, as well as starches used both in food and the manufacturing of products such as cardboard boxes. It competes with larger US-based rivals Ingredion and Archer Daniels Midland.

Tate & Lyle said it “continues to successfully execute its strategy and remains confident in the future growth prospects of the company”.

“The board believes that if a transaction of this nature was completed, it would enable Tate & Lyle and the new business to focus their respective strategies and capital allocation priorities and create the opportunity for enhanced shareholder value,” it said.

• A shortage of semiconductors, the critical chips used to calibrate cars’ fuel injection, run infotainment systems, or manage cruise control, has shaken up the global auto industry, forcing assembly lines to shut down and denting dealers’ inventory.

• A year into the pandemic, millions of Brazilians are going hungry, evidence that president Jair Bolsonaro’s bet that he could protect the country’s economy by resisting public health policies intended to curb the virus has failed.

• After last week’s global climate change summit, Washington faces the challenge of steering the world towards cleaner energy—but the fact that several large countries made no new pledges to reduce fossil fuel use is a sign of limited US influence.

• Drug overdoses rose across the country during the coronavirus pandemic, but they skyrocketed in San Francisco, claiming 713 lives last year, more than double the 257 people there who died of the virus in 2020.

• The White House said it was unaware that a Baltimore factory had discarded millions of potentially contaminated doses of AZN’s coronavirus vaccine when Biden gave it permission to ship vaccines to Mexico and Canada.

• The Biden administration’s plan to withdraw troops from Afghanistan has sparked worry about future Taliban rule, but the White House says the group must govern less harshly than feared if it hopes for recognition and financial support from world powers.

• Caitlyn Jenner, the Republican former Olympian and prominent transgender activist, announced she would challenge governor Gavin Newsom of California in this year’s recall election, though it’s uncertain if and when the recall would take place.

• The pandemic opened up new possibilities for companies that help restaurants operate—investors and venture capitalists are sourcing deals in the “restaurant tech” sector, looking for startups that bring the big chains’ advantages to independents.

• The Fed saved money market mutual funds for the second time in 12 years in March 2020, exposing regulatory shortfalls that persisted even after the financial crisis—and now “these savings vehicles could be headed for a more serious overhaul.”

• + DIS: ABC sold out its advertising inventory for the Academy Awards on Sunday, with companies like Google, GM, and VZ spending an estimated $2M for 30-second spots, only a slight decline from last year, though the audience is expected to be smaller.

• India’s coronavirus outbreak is becoming a devastating crisis, with hospitals full, oxygen supplies running low, people dying while waiting to see doctors—and mounting evidence that the actual death toll is far higher than officially reported.

• President Biden’s pledge to cut America’s climate warming emissions in half by 2030 is technologically feasible and ecologically imperative—but economically, it could pose a challenge, though the rewards should be worth the cost.

• Though the pandemic sent the US unemployment rate up and left millions of Americans struggling to make ends meet, chief executives—even those working at companies hard-hit by the crisis—continued to rake in huge pay packages.

• President Biden recognized the mass killings of Armenians more than a century ago as genocide, signaling a willingness to test an increasingly frayed relationship with Turkey, long a key regional ally and an important partner within NATO.

• A landmark United Nations report is expected to declare that reducing emissions of methane, the main component of natural gas, will be a crucial element of efforts to ward off the worst effects of climate change.

• In a Siena College poll, New York governor Andrew Cuomo’s ratings are at the lowest level of his tenure, with allegations of sexual harassment continuing to erode his support, but the numbers may not dent his re-election changes.

• Investors holding broadly diversified stock funds over the last year did well, says columnist Jeff Sommer—in the 12 months through Friday, the S&P 500 returned more than 50 percent—but things were so bad a year ago that the numbers had nowhere to go but up.

• Front page story reports “President Biden’s capital-gains tax proposals would alter wealthy Americans’ investment strategies and reignite the long-running political debates over the link between tax rates and economic growth.”

• Biden’s target for slashing auto emissions targets by 2030 would require companies in energy, transportation, agriculture and more to greatly speed the pace of change, and many would face significant new costs.

• Some SPACs are targeting companies with below-investment-grade credit ratings; not since the dot.com-boom two decades ago has stock-market enthusiasm been hot enough to fuel such activity in debt markets.

• Story says that as demand for plastics grows, so does concern over the waste—and that more than 90 percent of the plastics generated annually in the US winds up in landfills or incinerators, with only nine percent recycled, according to the EPA.

• Recent economic surveys indicate that US and global economies are showing signs of stronger growth as factories continued to boom and service businesses began to see the benefits of vaccination programs.

• The bipartisan Problem Solvers Caucus supports a gas-tax increase to fund infrastructure repair—the group proposed indexing gas and diesel taxes to inflation, highway construction costs, fuel-economy standards, or some combination of the three.

• Attorney General Merrick Garland told largest law-enforcement organizations that an investigation into the Minneapolis Police Department will be the first of several broad civil-rights probes by the Justice Department into police departments.

• In a story written by BBY chief Hubert Joly, he details his “Renew Blue” strategy to turn around the electronics retailer when everybody thought that competition from AMZN and other online players would bury it.

• H.O.T.S.: Online trading app Robinhood said a quarter of trading in Bitcoin and other online currencies is done by women, though that level lags their trading in stocks and ETFs; The initial buzz around 3-D printing didn’t pan out in the market—and current speculation may be no different; Corporate travel spending on AXP cards remains depressed, but trends such as younger spenders and a bigger desire for status could help.

FINANCIAL TIMES

Weekend

• “Joe Biden’s proposal to almost double capital gains tax rates for the richest Americans has triggered a chorus of disapproval from top lawmakers, underscoring the intense opposition the president is set to face as he attempts to push his plans through Congress.”

• A malaria vaccine trial from Oxford University found that the shot, known as R21, was 77 percent effective—dramatically better than existing shots for preventing one of the world’s most deadly diseases.

• German chancellor Angela Merkel defended her lobbying for Wirecard in China in 2019, saying there was no reason at that time to assume there were irregularities at the company where fraud was later uncovered.

• Russia will withdraw from the International Space Station in 2025, ending a period of time that saw strong international cooperation, dating back to planning for the station at the end of the Cold War.

• Moscow’s move to pull back soldiers from the border with Ukraine serves to send a message to the country and its Western supporters that Russia remains a force to reckon with on Europe’s south-eastern side.

• Japan announced a short period of Covid-19 restrictions, incorporating a week-long holiday in its largest cities in a bid to counter a rapid rise in cases.

• Big Read piece “Twelve of Europe’s top football clubs planned to shake up the sport with a new Super League. Instead, it collapsed spectacularly in just 48 hours amid mass public protest, communications disasters, and a political furor.”

• Lex Column: FirstGroup’s current business plans suggest it will be a lower margin business in the future—which also comes with fewer risks; Tod’s would be an ideal brand to take private—it has a small free float, has exhausted options for a recovery, and moves slowly; MAT can’t count on a pandemic sales boost lasting indefinitely.

• Comment: Delivery riders for Deliveroo will soon be an endangered species, says John Gapper—“There will be a place for supervisors, ambassadors, and doorstep greeters, but robots will be right behind them.”

• Bitcoin investors are dealing with a plunge in cryptocurrency after reports that President Biden is set to raise capital gains taxes on wealthy Americans, a move that could slow Bitcoin’s momentum.

• + MAT: The toy company “experienced a short-lived surge in its stock price Friday thanks to a blowout quarter fueled by continued demand for Barbie—who’s become unstoppable since the pandemic took hold.” - Source TradeTheNews.com

Rally in videogame retailer’s share price provides unusual boost in value of stock awards for departing executives

It is a lucrative time to be leaving GameStop Corp.’s GME 0.01% C-suite as the run-up in the videogame retailer’s share price has enabled four executives to depart with vested stock now valued at roughly $290 million.

Separation agreements between GameStop and the four executives, including Chief Executive Officer George Sherman, have provisions that let stock awarded during their tenure to vest when they leave. While such a handling of leadership transitions isn’t atypical, it does potentially allow the executives to sell their shares near GameStop’s historically high levels.

GameStop’s shares closed Friday at $151.18. They hit an intraday peak of $483 in late January after ending 2020 at just below $19.

The fortunes the executives stand to gain, based on a Wall Street Journal analysis of recent GameStop securities filings, reflect the rapid and unusual rise in the company’s market value as it became a darling of individual investors and the focus of a turnaround steered by activist investor and Chewy Inc. co-founder Ryan Cohen. Three of the four executives joined the company in 2019.

GameStop has said that Mr. Sherman will step down by July 31 and that it is searching for his replacement. His exit agreement calls for the accelerated vesting of more than 1.1 million GameStop shares, according to filings, valued at roughly $169 million as of Friday’s close.

Mr. Sherman’s severance pay could have been higher. According to his separation agreement and GameStop’s recent proxy filing, the CEO agreed to give up at least $5 million in cash, stock valued at roughly $47 million as of Friday, and additional equity awards. No reason was given for the changes, and Mr. Sherman declined to comment.

As of mid-April, Mr. Sherman held a roughly 2.4% stake in the company, making him one of the largest individual shareholders.

Restricted shares held by former GameStop finance chief James Bell vested April 1, according to the proxy filing. Those shares were valued at $43.6 million as of Friday. The company didn’t cite a reason for Mr. Bell’s departure, though the Journal reported that he was pushed out of the role by Mr. Cohen, according to people familiar with the matter.

Frank Hamlin, who resigned as chief customer officer last month, had restricted shares that vested April 7 and were valued at $33.5 million as of Friday.

Chris Homeister, who plans to resign as merchandising chief because of diminished responsibilities, has nearly 289,000 shares due to vest in connection with this exit. Those shares were valued at around $43.6 million as of Friday.

Messrs. Bell, Hamlin and Homeister could earn additional shares under their employment agreements based on the company’s performance this year, according to GameStop filings.

Mr. Bell declined to comment. Messrs. Hamlin and Homeister couldn’t be reached for comment.

Granting shares as part of compensation packages is a longstanding practice intended to align executives’ interests with shareholders’ interests. As a company’s performance or outlook improves, the thinking goes, share prices should rise, and both executives and shareholders benefit.

Big payouts for departing executives, especially longtime ones, aren’t unusual. Former T-Mobile US Inc. boss John Legere collected more than $137 million in compensation in 2020, according to a securities filing Wednesday. Most of that came from the then-chief executive’s severance payment after more than seven years atop the telecommunications company, as well as equity that vested early upon his departure and bonuses tied to the company’s successful completion of its merger with Sprint Corp.

Mr. Sherman’s compensation for the 2020 fiscal year was valued at $7.2 million, most of which came from stock awards, according to a proxy filing. That figure includes about $1.5 million in shares that Mr. Sherman is giving up under his departure agreement. His total compensation in the prior year was $12.4 million, the first year he served as CEO.

The payouts for Messrs. Sherman and Legere reflect a broader trend of CEO compensation surging in 2020. Median pay for the chief executives of more than 300 of the biggest U.S. public companies reached $13.7 million last year, up from $12.8 million for the same companies a year earlier and on track for a record, a recent Journal analysis concludes.

Mr. Sherman joined GameStop in April 2019, a few months after the company failed to find a buyer. He became the company’s fifth CEO since 2017 and pledged to turn the retailer around. During his tenure, GameStop was able to reduce its costs and debt, but the business has struggled. Revenue fell to nearly $5.1 billion in the year ended Jan. 30 from $6.5 billion in the prior year. Losses topped $686 million in the past two fiscal years combined.

To improve its outlook, the company last month tapped Mr. Cohen, former boss of online pet-supplies company Chewy, to head a committee dedicated to making the business more tech-centric by focusing more on e-commerce. Mr. Sherman recently said he expects GameStop to benefit from plans to expand the company’s product selection to make it less dependent on the releases of new game consoles from the likes of Sony Group Corp. and Microsoft Corp.

Before the central bank begins to scale back support for the economy, it must first decide how to communicate the idea to markets

WASHINGTON—As the economic recovery evolves from forecast to reality, the Federal Reserve will face a question that has vexed it in the past: how to signal its eventual tightening of the money spigot.

The process of ending the Fed’s giant bond-buying program, and subsequently raising interest rates, will take years unless inflation unexpectedly surges. Its first step down that road will be to start talking about it in the coming months or weeks—Chairman Jerome Powell’s next big test with financial markets.

Officials will begin by debating how and when to scale back, or taper, the $120 billion-plus of Treasury and mortgage bonds the Fed has been buying each month since last June to hold down long-term borrowing costs.

That conversation hasn’t yet kicked off, according to public comments from central bankers and minutes from their March 16-17 policy meeting. The Fed said in a postmeeting statement that the U.S. labor market and inflation would have to make “substantial further progress” before it begins to reduce its bond program. Asked at a press conference whether it was time to start talking about talking about reducing bond purchases, Chairman Jerome Powell said, “Not yet.”

At the time, economic forecasts were calling for a pickup in growth, but hard data were still reflecting a slowdown during the winter Covid-19 surge. That has changed in the past six weeks, with data confirming some of the progress Mr. Powell said he wanted to see.

On April 14, Mr. Powell took a small and subtle but important step by establishing parameters for the coming discussion, more clearly defining his goal. The Fed will be measuring the economy’s progress “from last December, when we [first] announced that guidance,” rather than from March, when policy makers reiterated it, he said. That means with each indicator of improvement, there is less ground to make up.

This is delicate business for a central banker. The last time the Fed started telegraphing a reduction in its asset purchases, in 2013, it sparked a bond-market selloff known as the “taper tantrum.” Mr. Powell, then part of a small cohort of governors pushing to scale back the program, was in the middle of the discussion. Yields on 10-year Treasury notes, which directly affect long-term borrowing costs for consumers and businesses, jumped half a percentage point in just one month, rattling Fed officials who worried they might undermine the recovery they had been trying to nurture.

The episode underscored the tricky balance central bankers must strike when withdrawing support from the economy. Move too soon and borrowing costs can rise abruptly, undermining growth. Even talking about moving too soon can hurt. Wait too long—or even signaling an inclination to wait too long —and inflationary pressures can build or financial bubbles can emerge.

Jeremy Stein, who served with Mr. Powell on the Fed’s board of governors during the 2013 unpleasantries, said a lesson he drew from the episode is that there are limits to the central bank’s ability to calm markets amid a shift to tighter policy.

“You try very hard, but it’s very hard to manage the volatility,” Mr. Stein said.

Mr. Powell has said he hopes to minimize disruptions this time by giving the market plenty of notice ahead of any changes to its bond-buying plans.

Data released since mid-March show significantly more jobs have been added in recent months, though overall employment remains well short of levels seen a year ago. Meantime, inflation has been higher than economists had anticipated. An eye-popping jump in retail sales further supported economists’ thesis that the end of pandemic-related restrictions will trigger a surge of pent-up demand from consumers, powering a robust recovery.

“I think the economy is ready to rip,” Fed governor Christopher Waller said April 16.

The U.S. labor market remains 8.4 million jobs short of its pre-pandemic level, a figure Mr. Powell often references to illustrate the distance remaining to a full recovery. In welcoming the 916,000 jobs created in March, he said the Fed wants to see “a string of months like that so we can really begin to show progress toward our goals.”

Since December, when the Fed set the guidelines for rewinding bond purchases, payrolls have increased by 1.62 million. That is certainly progress, though it doesn’t seem to meet the Fed’s mark of substantial. The jobless rate has fallen from 6.7% to 6% but remains well above the 3.5% level reached before the pandemic.

Fed officials have avoided providing a clearer definition of “substantial progress.” They are wary of boxing themselves in at a time of heightened uncertainty about the economy’s path.

Pulling back easy money this time could look different than the slow and carefully staged process that took place last time. After the 2007-09 recession Washington officials focused on reducing budget deficits, which seemed to hold back growth, and inflation was tame. This time, trillions of dollars of fiscal stimulus are coursing through households, businesses and local governments, charging up growth. Economists expect inflation to reach 3% by midyear due to temporary factors and then retreat.

Primary dealers surveyed by the New York Fed in March expected the central bank to begin cutting bond purchases in the first quarter of 2022 and finish by the end of next year. The first increase in interest rates, currently pegged near zero, would likely come some time after. Fed officials expect to leave rates unchanged through 2023, according to their own projections.

Battle with billionaires and activist fund to keep control of media and retail group

Arnaud Lagardère is nearing an agreement to give up the distinctive legal structure that has long granted him tight control over his eponymous French media and retail group in an effort to neutralise the threats posed by two billionaires and an activist hedge fund.

The French businessman is in talks to abandon the so-called commandite governance system, which was set up by his father when he founded Lagardère in 1992, in exchange for €200m-€250m, said people familiar with the matter. The commandite allows him a veto power on most company issues despite owning just a 7 per cent stake.

But Arnaud Lagardère has been backed into a corner by Vincent Bolloré, who has used Vivendi, the media company he controls, to build up a 29 per cent stake in Lagardère, as well as activist Amber Capital, which has long agitated for change and owns a 20 per cent stake.

To try to fend them off, he signed a deal with billionaire Bernard Arnault a year ago, which made the LVMH boss a partner with a 25 per cent stake in his personal holding company through which he controls the commandite. That also gave Arnaud Lagardère a much needed cash infusion to pay down personal debts.

The lifeline from Arnault bought the heir some time but also intensified the battle at the company since it prompted Vivendi not only to team up with Amber, but also to raise its stake to just under the limit before it would have launch a public offer.

In recent weeks, talks between the parties have accelerated to find a negotiated solution to the wrangling, people familiar with the matter said. The catalyst was the looming annual shareholder meeting in June since Arnaud Lagardère risked another rebellion against him with a potential vote to replace the board, said one of the people.

The outlines of the deal are that Arnaud Lagardère would receive the payment in exchange for agreeing to dissolve the société en commandite par actions (SCA) and replacing it with a conventional société anonyme. Existing shareholders would be diluted. Lagardère would hold an enlarged stake, three board seats, and a multiyear contract to be chief executive, said the people.

Vivendi would hold three board seats, while Amber, Arnault, and longtime shareholder Qatar Investment Authority would each have one seat.

The people cautioned on Sunday that the talks were continuing and could fall apart. A board meeting at Lagardère was expected on Monday and an announcement would soon follow.

If concluded, the accord would open up a new phase at the company where Arnaud Lagardère would still have to contend with powerful shareholders on a new board of directors.

But he would be able to declare a victory of sorts because his group would not be dismantled for now, and influential media assets, such as the Journal du Dimanche and Paris Match magazine, remain under his control.

Lagardère group was once one of France’s industrial powerhouses with businesses in aerospace, defence and autos, but has since been whittled down via asset sales to be focused on two main activities: the world’s third-biggest book publisher Hachette, and a travel retail business that operates Relay newsagents and duty-free stores in railway stations and airports.

Last year, the various factions had discussed several scenarios including one in which the group would have been broken up with Vivendi taking Hachette and LVMH the travel retail business. But Arnaud Lagardère has long said he did not want to break up the company and those talks did not reach fruition.

Italian group buys 25% of military sensor maker in deal that could drive defence consolidation

Leonardo, the Italian defence group, intends to use the purchase of a stake in military sensor maker Hensoldt as a springboard to expand its presence in Germany’s growing defence market, according to its chief executive. 

The deal, agreed at the weekend, could help drive European consolidation in the sector and eventually pave the way for the creation of a major defence electronics concern.

Under the terms of the deal, Leonardo will buy a 25.1 per cent stake in Hensoldt from private equity group KKR for €23 a share in cash or about €606m.

The Italian group will become Hensoldt’s largest shareholder alongside German state bank KfW, which bought a 25.1 per cent stake in March. KKR will maintain a share of about 18 per cent. The balance of the shares are listed in Germany. 

Leonardo held off competition from France’s Thales and Sweden’s Saab to clinch the purchase. 

“It is another step in the European defence system,” Alessandro Profumo, Leonardo chief executive, told the Financial Times. While Leonardo had “some presence” in Germany, it was a country where the company “could improve”. 

“Germany is an incredibly important country,” he added, noting that in a previous role as chief executive of UniCredit he had said that “you can’t be European without Germany”. 

“It is the same in this case,” Profumo added. 

The deal will strengthen Leonardo’s position in Europe’s three core defence markets: Italy, the UK and Germany. 

It is also an important step in what could be a series of strategic partnerships in defence electronics, according to industry analysts.

Leonardo and Hensoldt already co-operate on pan-European programmes including the Eurofighter Typhoon fighter. The two companies, together with Spain’s Indra, provide the advanced radar on the aircraft. The German air force last year ordered a further 38 Typhoons.

Longer-term, the two companies’ close relationship could help pave the way towards closer co-operation between Europe’s two future-generation fighter programmes, Britain’s Tempest and the Franco-German Future Combat Air System (FCAS).

In the UK, Leonardo is one of the industry partners working with BAE Systems on Tempest, the new generation fighter jet for the Royal Air Force. Hensoldt, meanwhile, is part of the FCAS consortium.

Defence industry analysts said that while it was unlikely the two programmes would come together, the respective aircraft would eventually have to fly together as part of Nato.

“It would make sense to explore whether the two programmes could share some commonality,” said one person familiar with the thinking.

Leonardo said it intended to fund the purchase of the stake through the sale of non-core assets and the flotation of a minority stake in DRS, its American military electronics arm.

The Italian group postponed the listing on the New York Stock Exchange in March citing adverse market conditions. Analysts had estimated that the group, which acquired the US unit in 2008 for $5.2bn, would sell between 20 per cent and 30 per cent of its subsidiary for at least $3bn.

Profumo said the company was ready to proceed with the listing as soon as market conditions allowed.