• by Erik Sass , January 29, 2007

The owner of Hachette Filipacchi, Lagardère SCA, announced last Thursday that it is cutting hundreds of jobs from its media division in Paris. The move is part of a continuing reorganization spearheaded by new chairman Didier Quillot at the behest of owner Arnaud Lagardère. Lagardère says it will ax about 7% to 10% of the 9,900 positions in the media division--roughly 700-1,000 people.

Some of the personnel cuts may fall on the French staff of big-name publications, such as Elle, Marie Claire and Car and Driver. Lagardère is also planning to merge ad departments, allowing less profitable magazines to be produced under license, while closing 20 unprofitable titles.

However, no specific details were available at press time on Friday, and it's unclear whether personnel cuts are planned at any of the company's American operations, as well. Arnaud Lagardère has said he is determined to expand the presence of Hachette Filipacchi in America and Britain with big acquisitions.

Overall, the restructuring is expected to cost $100 million to $130 million in 2007, but should yield savings of about $100 million a year over the long term. Lagardère has moved to hurry the transition of its media operations into multiplatform digital publishing, beginning with the appointment of Didier Quillot, formerly chief of telecom giant Orange France, last fall.

Quillot occupies a new role as chairman of Hachette Filipacchi and Lagardère Active, the company's digital arm, and is supported by two new board members also shared by both companies: Olivier Chapuis, formerly President of Interdeco, and Alain Lemarchand, formerly CEO of Lagardère Active.

Under the leadership of president Jack Kliger, Hachette Filipacchi's American operation is already one of the country's largest magazine publishers, ranking fourth in the group publisher's report produced by TNS Media Intelligence--behind only Time Inc., Conde Nast and Hearst.

Founded in 2004, Lagardère Active North America has already worked with Hachette properties here to create mobile content for Car & Driver Mobile, Elle Mobile and American Photo Mobile. But the relationship has been sluggish, and Quillot is expected to kick cooperation into high gear.

Arnaud Lagardère is reported to have accumulated a war chest of about $2.5 billion for acquisitions through the sale of half his stake in EADS, the troubled European aeronautic consortium that produces Airbus planes. Lagardère SCA is currently under investigation by European securities regulators for alleged impropriety in relation to this deal. French investigators say Lagardère may have had information about production delays affecting new planes when he sold shares in EADS, before the news of delays was made public.