Eurazeo ousts chief Virginie Morgon after shareholder power struggle

Virginie Morgon, one of the rare female leaders of a private equity group, has been ousted from the helm of France’s Eurazeo after losing the support of its two largest shareholders.

A statement from Eurazeo on Monday said the supervisory board and Morgon “jointly decided that her duties as CEO and member of the executive board of Eurazeo should cease”.

The firm announced the nomination of new leadership for the publicly traded French group, which has €32.4bn in assets under management, including nearly €23.2bn from third parties.

The leadership overhaul marks the culmination of several years of squabbles and changes within the Paris-listed company’s shareholder base.

Eurazeo’s historical anchor shareholder is the aristocratic David-Weill family, one of the important shareholders in Lazard investment bank. Before joining Eurazeo in 2008, Morgon spent 16 years at Lazard in New York, London and Paris, and was a protégée of former Lazard chair Michel David-Weill, who died last year.

Morgon took over as chief executive in 2018 and has been instrumental in growing and diversifying Eurazeo beyond its roots in mid-market private equity in its domestic market. The company’s investment strategies now encompass venture capital, private equity, private debt and real assets, and it has 12 offices globally.

Shares in Eurazeo, which has a market cap of €5.1bn, dropped 2 per cent on Monday and are down 10 per cent over the past five years.

In April 2017, it emerged that rival alternatives manager Tikehau Capital had started to build up a position in Eurazeo’s share capital. The following month, Crédit Agricole put its 15.4 per cent stake in Eurazeo up for sale, and the private equity group’s management feared Tikehau might use the opportunity to invest further and become its largest shareholder.

The Decaux family, which owns the eponymous outdoor advertising business, was brought in as a white knight, and its investment vehicle JCDecaux Holding bought the Crédit Agricole stake in June 2017. Tikehau reacted by selling out of Eurazeo by the end of 2021.

According to people familiar with the situation, the Decaux family, which now owns 18 per cent of Eurazeo and is its largest shareholder, and the David-Weill family, which owns 16 per cent and is Eurazeo’s second-largest shareholder, had three main concerns.

They wanted to accelerate the push into asset management, they felt that Morgon’s management style was not sufficiently collegiate, and they had grown frustrated with the company’s lacklustre share price growth.

Eurazeo is now trading at a similar level to when the Decaux family bought into the group. Following the death of Michel David-Weill, Morgon could no longer count on the David-Weill family to support her and be a foil to the group’s largest shareholder.

Jean-Charles Decaux, president of the supervisory board, said in a statement that Morgon had “accelerated the group’s growth, diversification, and internationalisation”.

Under Morgon’s tenure, Eurazeo pushed into the US and expanded through acquisitions such as a stake in New York-based private equity firm Rhône Group and French private equity manager Idinvest. The firm’s assets have more than doubled from €16.8bn at the end of 2018, to €32.4bn.

Eurazeo on Monday announced what it called “a new, collegial, and focused” executive board that it has charged with accelerating its position in third-party asset management and improving performance. The new executive board is composed of two chairs, Christophe Bavière and William Kadouch-Chassaing, as well as two other executives.

Bavière is the founding chair of Idinvest, and Kadouch-Chassaing is Eurazeo’s general manager of finance and strategy.

Morgon said in the statement that she was leaving Eurazeo “with huge pride in the successful transformation of the group”. She did not respond to requests for further comment. Eurazeo declined to comment beyond the statement. The Decaux family could not immediately be reached for comment.

Additional reporting by Arash Massoudi and Kaye Wiggins