France ups holdings in Renault, seeks blocking stake

By Aurilia End, AFP

PARIS–The French government said Wednesday it is increasing its holding in carmaker Renault to gain a blocking minority stake and ensure that measures designed to reward long-term investors come into force. A law adopted last year to encourage long-term investors will give them double voting rights at shareholder meetings, although shareholders can vote to opt out of the system. With some Renault shareholders looking to prevent these measures from taking effect at the annual meeting on April 30, the finance and economy ministry said Wednesday it was buying shares to take the state’s stake to 23.2 percent, up from its previous holding of 15 percent. Given Renault’s diverse shareholder base and generally low participation rate at shareholder meetings, a ministry source said this should give it the third of votes needed to block an effort to keep the double voting rights measure from taking effect. Officials said the move was in line with the French government being an activist investor and protecting the nation’s long-term interests. ��This operation demonstrates the desire and capacity of the French state to utilize all the tools at the disposal of investors to promote capitalism and progress in the long term in the interests of employees and the development of companies,�� said Economy Minister Emmanuel Macron in a statement. ��This operation shows that the French state is at the same time a shrewd investor and a defender of the public interest.�� The French state has not shied away from protecting companies it views as strategic, recently seeing off attempts by Yahoo! and a Hong Kong telecoms giant to buy a stake in the video-sharing site Dailymotion.