France's Lagardere gives up grip over family firm

French billionaire Arnaud Lagardere has agreed to relinquish control over his media empire, which includes the Hachette publishing house, under pressure from investors and influential business tycoons.

The Lagardere group includes Hachette, the Relay chain of airport and railway station newsagents, as well as Paris Match magazine, Europe 1 radio station and other media outlets.

Arnaud Lagardere had for years resisted attempts by British hedge fund investor Amber Capital to loosen his grip on the company he has run since the death of his father Jean-Luc in 2003.

While only holding seven percent of shares following years of selling his stock, Lagardere retained veto power over the group under an arcane legal structure that acted as a shield against takeover attempts.

But on Wednesday the Lagardere group said that its supervisory board had "positively received" a proposal to abolish the structure, handing power to shareholders in line with their shareholdings.

As well as Amber Capital, rival French tycoons Bernard Arnault of the LVMH luxury goods conglomerate and industrialist and media magnate Vincent Bollore have built up stakes in the group.

French media have speculated about a breakup of the Lagardere empire, with Arnault and Bollore competing to buy parts of the business.

The changes to the company's corporate governance will be put to a vote at a board meeting on June 30.

Under the reform, Arnaud Lagardere will remain CEO of the company for six years and will receive a payout in new shares equivalent to about 7 percent of the group's capital, the company said.

"I am sincerely very, very happy about this turn of events. It's a change that I wanted and for which I take responsibility, without qualms or regrets," Lagardere said in a phone-in press conference.

Lagardere has been hard hit by the Covid-19 pandemic, which has decimated its travel retail revenues.

In January, it received a nearly half-a-billion-euro rescue package underwritten by the French state.