Breton Named France Telecom Chief
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PARIS (AP) _ The board of France Telecom appointed Thierry Breton to lead the troubled state-controlled company on Wednesday, hoping his skills as a turnaround artist would cure its massive debt problem and win back investor confidence.
The French government later formally approved the appointment of the 47-year-old former chief executive of electronics group Thomson Multimedia during a weekly Cabinet meeting.
Breton replaces Michel Bon, who resigned last month because of the telecommunication giant’s record first-half losses and debts of nearly $69 billion.
Breton is expected to move quickly to solve a looming liquidity crisis amassed under Bon’s leadership and launch a cost-cutting program to help trim the company’s mountainous debts.
He also needs to win investor confidence to stem a 97 percent decline in the company’s share price since March 2000. Company shares closed up 10.2 percent at 8.43 euros ($8.29) on the Paris stock exchange on news of the company’s new leadership.
Breton has a reputation as turnaround specialist. Since he joined Thomson Multimedia in 1997 _ when the government nearly sold the loss-making business for one symbolic French franc _ revenue has increased by more than 80 percent.
Officials hoped he would do the same for France Telecom.
His mission ``will be to ensure the optimum conditions for the recovery of this fine company,″ said Finance Minister Francis Mer after the Cabinet meeting.
France Telecom board member Michel Gaveau said Breton will undertake a strategic review of the company over the next two months, but declined to discuss further details.
``We are in a transition situation and important questions will be answered later,″ Gaveau told reporters after the board meeting.