Two more Bull directors have stepped down.
The latest resignations at Bull follow the departure of chairman-designate Didier Pineau-Valencienne, who publicly stated the reason for his leaving was that he had completed the mission he accepted from previous chief executive Pierre Bonelli. Privately however, there were suggestions of a rift with leading shareholders.
Meanwhile, the position of the acting chief executive, Gervais Pellissier, received an additional boost with the news that Bull has decided not to appoint a new chairman, and has instead confirmed Mr Pellissier as acting chairman and managing director.
Shareholders have also approved Bull’s financial restructuring. Bull is seeking formal approval from the European Commission for a bailout from the French state. The French government wants to inject E520 million into the vendor, which will allow it to repay the controversial E450 million loan it received from the French state in 2002.
Unfortunately, the French Government is notorious in stretching (or even breaching) European competition rules governing state subsidies for struggling companies. The Commission is currently investigating other recent cases of the French government bailing out French businesses. These include state aid to France Telecom, Air France, and most recently the E3.2 billion bail-out of ailing engineering group Alstom.
However, the new restructuring plan filed by the French government does contain a new twist, because it is only due to start in January 2005. This is exactly 10 years after the last government bail-out in 1994 when Bull benefited from E1.3 billion in state aid. Prior to this, between 1983 and 1993, it is estimated that the French government pumped another E2.0 billion into the vendor.
Unfortunately for Bull, its main business is making servers and mainframes, a market it admits is gradually dwindling. Its hopes rest on its IT services business, and Mr Pellissier has a tall order to successfully guide the company through the final stages of its restructuring and then work out its strategy as Europe’s only remaining major computer manufacturer.
