Hachette Filipacchi Medias S.A.

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Hachette Filipacchi Medias S.A.

151, rue Anatole France
92598 Levallois-Perret Cedex
France
(33) 01.41.34.73.97
Fax: (33) 01.41.34.77.77
Web site: http://www.lagardere.fr

Public Company
Incorporated: 1957 as Publications Filipacchi
Employees: 742
Sales: FFr 11 + billion (1997)
Stock Exchanges: Paris
SICs: 2711 Newspapers; 2721 Periodicals; 4832 Radio Broadcasting Stations

The June 1997 fusion of Filipacchi Medias S.A. and Hachette Filipacchi Presse (HFP) to form Hachette Filipacchi Medias S.A. was something of a formality: the two French magazine and communications powerhouses have been deeply intertwined since the early 1980s. With consolidated revenues expected to top FFr 11 billion—of which Filipacchi Medias’s contribution equaled nearly FFr 1.6 billion—Hachette Filipacchi Medias has firmly positioned itself as the world’s leading magazine publisher, with nearly 160 French and international magazine titles. The newly formed company is 66 percent-owned by former HFP parent (through Hachette S.A.) Groupe Lagardère S.A.; Filipacchi Medias founders Daniel Filipacchi and Frank Ténot retain 13 percent of the shares, while the remaining are traded on the Paris Bourse. The company is led by President-Director-General Gerald de Roquemaurel, who replaced Daniel Filipacchi.

Filipacchi Medias

The smaller of the two groups, Filipacchi Medias has established a strong presence in the French magazine market. Among the titles contributed by Filipacchi Medias to the combined group are Paris Match, its flagship news weekly, with a circulation of nearly 850,000 copies; Photo, a monthly magazine with circulation of nearly 100,000; Jazz Magazine, the group’s oldest publication, with 15,000 circulation each month; Hablan, among the group’s youngest magazine, with monthly sales of 80,000 copies in its Spanish market; Pariscope: Une semaine de Paris, a weekly with circulation of nearly 120,000; the irreverent I’Echo des Savanes, with monthly circulation of nearly 140,000; men’s magazines Lui and Newlook; and monthlies Action Auto-Moto; OK! Podium; Femme; and Jeune & Jolie. Other publishing interests of the group include Editions Filipacchi, and adult comics publisher Séfam.

Beyond publishing, Filipacchi has been active in the multimedia realm, with interests in Skyrock, France’s third-largest F.M radio network, with a presence in more than 150 French cities; Chante-France, the first radio station in France to offer 100 percent French-language programming; Multiradio, a partnership with France Télécom Multimedia and Europe 2 Entreprises, Europe’s first cable-based digital radio network; Contact Télévision, a cable-based classified advertising service; and Film Office, a partnership with HFP, responsible for the developing and distributing videocassettes and feature films. Filipacchi Medias has also been active in advertising sales, through Interdéco Regie and Hachette Filipacchi Regie, both in partnership with Hachette Filipacchi Presse, and through its 51 percent control of Régioscope, Filipacchi’s partnership with French advertising giant Publicis S.A., created to sell advertising space in the group’s Pariscope magazine.

Hachette Filipacchi Presse

While Filipacchi Medias has concentrated primarily on the French market, Hachette Filipacchi Presse (a subsidiary of Groupe Lagardère S.A. and 34 percent controlled by Filipacchi Medias prior to the two companies’ merger) has built one of the world’s largest international magazine empires. HFP publishes 38 magazines in France, 107 international magazines, six daily French regional newspapers, as well as having interests in multimedia, internet, and the printing industries. HFP’s flagship publication has long been Elle magazine, which celebrated its 50th anniversary in 1995 and is published in 28 editions worldwide. Among the company’s French magazine titles are Télé 7, the country’s leading television programming weekly; T.V. Hebdo, a Sunday television supplement to French national and regional newspapers; Elle Décoration, also published internationally in 11 countries; women’s magazines, including Vital, Parents, Top Model, Maisons Cote Sud and Maisons Cote Ouest’, 14 titles of youth magazines, principally in association with the Walt Disney Company; video and video games titles such as Premiere, Vidéo 7, Joystick, Joypad, and Playstation’, and other weekly and monthly titles, such as Le Journal du Dimanche, Quo —launched in 1996—and Id Paris and France Dimanche. HFP’s other France-based publishing activities include six regional daily newspapers

HFP’s primary focus, however, has been on the international front. With 25 titles in the United States, HFP is the country’s leading specialist press publisher and the fourth-largest national publishing group. U.S. titles include Woman’s Day, Car and Driver, Premiere, Elle, Home, Travel Holiday, Eating Well, and John F. Kennedy, Jr.’s George. Elsewhere in the Americas, the company’s publishes titles in Argentina, Brazil, Canada, Chili, and Mexico. HFP’s second largest international market is Spain, where its 15 titles make it that country’s leading magazine publishing group. HFP has also built an extensive presence in the overall European market, in Greece, the United Kingdom, the Netherlands, Germany, Portugal, Sweden, and Italy, and in the Eastern European market in Poland, the Czech Republic, and Russia. In Asia, HFP publishes titles in Hong Kong, China, India, Japan, Korea, Singapore, Taiwan, Thailand, and Australia, while the company also publishes one title—Elle —in South Africa.

Beyond magazines and newspapers, HFP controls four printing operations in France, Spain, and Belgium, as well a 50 percent of Italy’s Rotocalcographica, making HFP the fourth-largest in the European printing industry. HFP has also taken an active role on the French multimedia front, especially in conjunction with Filipacchi Medias, with operations including Hachette Filipacchi Grolier; Publiprox; Film Office, and Hachette Filipacchi Télématique.

Magazine Empire Building in the 1960s

With an involvement in the bustling Paris jazz scene of the 1950s, and a family background in publishing (father Henri Filipacchi had joined with Hachette to form the industry-leading paperback publisher Livre de Poche in 1953), Daniel Filipacchi himself entered the publishing world in 1957. In that year, he combined his passion for jazz music and his own interests in publishing to form Publications Filipacchi. The new company’s first magazine became Jazz Magazine, which had appeared in 1954 and which Filipacchi took over in 1958. Four years later, Filipacchi prepared to launch a new magazine. Together with partner Frank Ténot, Filipacchi reformed Publications Filipacchi as Filipacchi Medias, and introduced the popular monthly Salut Les Copains.

The success of Salut Les Copains enabled Filipacchi Medias to begin building its magazine empire, grouped under the holding company Nouvelle Editions Musicales Modernes (NEMM), in which Filipacchi held 60 percent and Ténot held 40 percent. Growing rapidly during the 1960s, Filipacchi Medias concentrated on expanding its portfolio of titles, principally through the creation of new magazines. The first of these was Lui, a men’s magazine, borrowing from the success of Playboy magazine, launched in 1963. This magazine was quickly followed by Pariscope, a weekly guide to events and other news and attractions in Paris, created in 1965. Together with advertiser Publicis, the company formed Régioscope to sell advertising space in its new magazine. Two years later, Filipacchi entered the burgeoning photography market with its Photo magazine. In 1972, the company extended its male-oriented magazine line with its Union magazine.

Into the mid-1970s, Filipacchi Medias remained a relatively modest operation. That changed, however, in 1976, when the company acquired Paris-Match from the Prouvost publishing group. Created in 1949, the weekly Paris-Match became the company’s flagship publication. With a circulation of nearly one million copies each week, Paris-Match greatly expanded Filipacchi’s operations and vaulted the company into the ranks of France’s top magazine publishers.

The Hachette Link in the 1980s

Filipacchi Medias’ new position enabled the company to make the next step in its evolution four years later. In 1980, the company joined with Jean-Luc Lagardére, who had by then served as director general of French industrial company Matra since the early 1960s, to take control of Hachette, one of France’s premier publishing firms.

Hachette’s own history dated back to 1826, when Louis Hachette acquired the Brédif bookstore. In 1852, Hachette expanded, becoming the first to place newsstands in the French train states; Hachette’s newsstand concept would later extend to the Paris metro at the turn of the century. By then, Hachette had entered the relatively youthful magazine market, publishing Le Journal pour Tous beginning in 1855. The company also became involved in book publishing; in 1863, Hachette began publishing its Dictionnaire de la Langue FranÇaise. In 1945, as the Second World War ended, Hachette launched a new magazine, Elle, that would become one of the country’s most prominent in its genre. That same period also marked Hachette’s entry into the news magazine market. By the 1970s, Hachette had come under the control of holding company Mariis.

Hachette’s focus remained primarily on the French market until the 1980s. The acquisition of Marlis by Matra and Filipacchi Medias, with the former taking the majority control, and the latter acquiring a 20 percent stake, gave rise to a new subsidiary—HFP’s forerunner France Editions Publications—and a period of rapid expansion of the group’s magazine and newspaper activities. France Editions Publications (FEP), which grouped Hachette’s magazine and newspaper publishing activities, was placed under the direction of Daniel Filipacchi and Frank Ténot. Beginning in 1985, FEP began developing its international network of editorial subsidiaries, a move given extra emphasis with the Hachette acquisition of the U.S.-based Diamondis publishing group.

Meanwhile, during the 1980s, Filipacchi Medias was undergoing its own expansion and diversification, adding in 1984 the popular monthly L’Echo des Savanes, created two years earlier, and in 1987 launching the youth-oriented Jeune & Jolie. The company also boosted its advertising sales activities, forming Hachette Filipacchi Régies to govern sales of advertising space for titles in both the Filipacchi Medias magazine network and its HFP partnership. In the late 1980s, the company expanded this activity, adding in 1988 Groupe Interdéco Regie, founded in 1971, and forming Hachette Filipacchi Global Advertising and Hachette Interdéco (Espagne) in 1989. During this period, Filipacchi Medias diversified into radio with the acquisition of Skyrock in 1985, film production, joining FEP in its Film Office subsidiary, which had been established by Hachette in 1946.

At the end of 1984, Filipacchi Medias’s strong growth enabled the company to go public, listing on the Paris secondary market. The success of this offering led to a secondary offering in 1987. In that year, also, Filipacchi increased its participation in the Marlis holding company to 35 percent.

Fusing in the 1990s

In 1992, Matra-Hachette restructured its operations, dissolving the Marlis holding company and regrouping its Matra and Hachette holdings under Groupe Lagardére SCA. Filipacchi Medias, wishing to continue its increasingly intertwined association with Hachette, agreed to transfer its participation directly to FEP, which at that time assumed the new name of Hachette Filipacchi Press. Filipacchi Medias’s share of Mariis was converted to a 34 percent stake in HFP, while Lagardére, through its 100 percent control of Hachette SA, controlled the remaining 66 percent of HFP. The following year, Filipacchi’s new status enabled it to achieve a listing on the primary Paris stock exchange.

While HFP continued its drive into international markets, Filipacchi Medias was also expanding its French magazine holdings, adding the monthly Action Auto-Moto in 1991, creating the monthly Entrevue in 1992, and launching the pop-music monthly OK! Podium in 1993. On the multimedia front, Filipacchi Medias launched its Chante-France radio station, the first French radio station to feature 100 percent French songs during a period of that country’s increasing sensitivity to perceived cultural and language encroachments on French soil. The growth of cable television in France, meanwhile, enabled the company to expand in that direction as well, adding the digital transmissions of cable-based radio station Multiradio in 1993; Multiradio was subsequently extended to the emerging satellite broadcasting market in 1996.

By 1994, Filipacchi Medias was recording annual revenues of FFr 1.53 billion. Over the next two years, however, its revenues would remain largely flat, dropping to just under FFr 1.51 billion in 1995, and recovering slightly to FFr 1.55 billion in 1996. At the same time, the links among Filipacchi Medias, Hachette, HFP, and Groupe Lagardére had developed to such an extent that the merger of their operations seemed inevitable. In May 1997, the companies agreed to do just that, fusing their magazine and newspaper operations to form Hachette Filipacchi Medias. Completed in June 1997, the merger called for Hachette SA first to acquire 39 percent of NEMM. In a second step, Hachette SA would cede its 66 percent control of HFP to Filipacchi Medias. In the third and final step, NEMM would be merged into Filipacchi Medias, which would then assume its new name, Hachette Filipacchi Medias. The end result was to give Lagardére a majority of a total of 67.4 percent (including 65.9 percent held by Hachette SA) of the new company. Daniel Filipacchi and Frank Ténot retained 13.1 percent of Hachette Filipacchi Medias, while the remaining 19.4 of shares were held by the public.

Following the merger, Daniel Filipacchi stepped down from the leadership of the company, transferring to head the company’s U.S. subsidiary. Gérald de Roquemaurel was named in Filipacchi’s place. The merger created of Hachette Filipacchi Medias the world’s leading magazine and newspaper publishing group, with combined 1996 revenues of more than FFr 11 billion. And with the power of Lagardére behind it, Hachette Filipacchi Medias seemed certain to maintain its leadership position well into the new century.

Principal Subsidiaries

Hachette Filipacchi Presse; Cogedipresse; Publication Filipacchi BV; Groupe Interdéco Régie; Hachette Filipacchi Grolier; Hachette Filipacchi Magazines, Inc. (U.S.).