PARIS (Reuters) - Activist shareholder Amber Capital, which is being sued by Lagardere (LAGA.PA), said on Monday the lawsuit was baseless and it would continue to seek strategy and management changes at the French publishing group.
Lagardere - whose businesses include publishing house Hachette and Relay news agents - said on Friday it was suing minority shareholder Amber and seeking 84 million euros ($93 million) in damages.
It accused the fund, which also has a stake in French utility Suez, of leading a “destabilising campaign” and using smear tactics in the press, adding that these had hurt its share price.
Deteriorating relations between the two come amid heightened sensitivity in France over the role of activist shareholders.
U.S. hedge fund Elliott Management, one of the most prominent activist investors, took a stake in French drinks group Pernod Ricard (PERP.PA) last year, and other funds have urged overhauls at several companies.
French lawmakers have put forward proposals, including bringing in more transparent disclosure requirements, which could feed into plans by the government to rein in activist funds with measures.
Amber, which invested in Lagardere over three years ago and now holds a stake of around 5.3%, said it would pursue its demands to improve Lagardere’s performance, and reiterated its criticism regarding managers’ compensation at the firm.
“Lagardere is hoping to intimidate Amber with this new claim, which is as aggressive as it is baseless,” Amber Capital said. “The reality of the company’s situation will not change until the managing partners decide to reconsider its strategy and governance.”
Lagardere shares were down 2.1% by 0842 GMT and have fallen about 10% this year.
The group, run by Arnaud Lagardere, who took it on from his late father, has been trying to shrink by selling off assets such as “Elle” magazine or French TV channels and refocusing on travel retail and publishing.
Its biggest shareholder is Qatar Investment Authority, the sovereign wealth fund.
Reporting by Sudip Kar-Gupta and Sarah White; editing by Jason Neely and Susan Fenton