France – Layoffs – Vivendi, STMicro Revamp Face Hollande’s Scrutiny

Vivendi SA (VIV) and STMicroelectronics SA (STM), each considering a reorganization to boost their competitiveness, face a hurdle as French President Francois Hollande struggles to keep an election pledge on job creation.

Industry Minister Arnaud Montebourg is today hosting STMicroelectronics Chairman Didier Lombard at Bercy, the sprawling 1980’s government complex in eastern Paris. The meeting will emphasize strategic discussions as Europe’s biggest chipmaker evaluates options ranging from asset sales to a break- up, people with knowledge of the matter said, asking not to be named because the gathering is private. A government agenda showed that a separate meeting with Vivendi’s Jean-Rene Fourtou was scheduled.

With Vivendi and STMicroelectronics employing about 26,000 workers in France in total, the government would be interested in any potential job eliminations from a reorganization, said the people. Even as Hollande had campaigned on the promise of “social justice,” his government last month had to backtrack on its objection to the closure of a PSA Peugeot Citroen (UG) factory in France as auto demand slumped.

“The perception is that the first priority of the French government is to protect jobs,” said Claudio Aspesi, an analyst at Sanford Bernstein in London. In the case of Vivendi, “there’s a question of what the government can live with, and that could be a tough conversation.”…

via Vivendi, STMicro Revamp Face Hollande’s Scrutiny Over Jobs – Businessweek.

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