France yesterday sensationally caved in to the forces opposed to the sale of Thomson Multimedia SA to Daewoo Electronics Co and halted the entire Thomson SA privatization process. Daewoo had promised to create 5,000 jobs in France if the sale were allowed to proceed. Shares in both Lagardere Groupe, which was to have bought Thomson before selling the consumer electronics side on to Daewoo, and Alcatel Alsthom SA, which had been the unsuccessful bidder, both fell on the news. The government will launch consultations as rapidly as possible allowing the privatization to take place on a basis that will be defined very quickly, prime minister Juppe said. The European Commission said that it will continue its investigation into the proposed recapitalization of Thomson to the tune of some $2.08bn.
