Vinci chairman resigns after boardroom feud

24 April 2008

Antoine Zacharias Resigned as Chairman of Vinci on June 1. His departure followed a dispute with CEO Xavier Huillard, who had accused Mr Zacharias of abusing his position to make excessive personal financial gains.

In a brief statement, Mr Zacharias said he had resigned, “In the best interests of the company and to put an end to the troubles within its management team.” He was replaced by Yves-Thibault de Silguy, a former executive of utilities group Suez and a former member of the European Commission for economic affairs.

Tensions between Mr Zacharias and Mr Huillard date back to January. On January 9 Vinci's Board announced it would split the roles of chairman and CEO, two posts which Mr Zacharias previously held. Mr Huillard was appointed CEO following the announcement.

Following his appointment as CEO, Mr Huillard wrote to Vinci's directors outlining a package of benefits, including stock options, which he alleged Mr Zacharias had awarded himself during his tenure as CEO. Mr Huillard accused Mr Zacharias of “enriching himself beyond all reason.”

According to Vinci's 2005 annual report, Mr Zacharias was the company's most highly paid director last year, with gross earnings of € 4,29 million. In addition to this Mr Zacharias owns 2,32 million shares in the company and 3,59 million in share purchase options. The current value of his shares is € 167 million, and the options are worth a further € 259 million, based on Vinci's current share price.

Mr Zacharias attempted to replace Mr Huillard as CEO with Alain Dinin, another Vinci director, during a Board meeting on June 1. However, the Board rejected this nomination making Mr Zacharias' position as chairman untenable and forcing his resignation.

Mr Zacharias had been Vinci's chairman since 1997, when the company was called SGE. In 2000 he oversaw the acquisition of GTM, which established Vinci as the world's largest construction group. Last year the company had revenues of € 24 billion, and made a net profit of € 1,1 billion.

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