We there was an idea of their real value

December 28, the Consortium of realisation (CDR) frees up its offices in the rue Saint-Georges, near the gare Saint-Lazare, Paris. Destination: rue de Lille, two not of the Seine in premises of the Fund of deposits (CDC), which will ensure effective January 1, the last records management. This company created by the State in April 1995 to support a huge stock of assets, for the essential problems, inherited from the Credit Lyonnais will thus address the last phase of its short existence. In carrying out the largest operation of "hiving", or out of balance, that the France was known, was to save the State-owned bank of bankruptcy. Fortunately for movers, the kilometres of archives have already shipped from le Havre. In fact, only a handful of last 24 employees will cross the Seine. They will be there to meet the demands of the Court of Auditors, which controls again, one of the most watched public sector organization. Others will leave and can be reach amicale of the "club of the completed". Since its birth, in effect, the CDR has been each year or almost a social plan.

Entering this phase of extinctive management occurred in April 2005, when the first assistance contract that gave the CDC administrative management was signed. This contract for any operational management. And a General Assembly will today appoint another Board of Directors. The third pattern of CDR, Jean-Pierre Aubert, his hand, as he announced it long time, at the end of his term of five years. It decrypts the purpose of the new organization: "CDR issues are now reduced, and to reduce management costs, the existence of a dedicated structure no longer has to this day of reason to be." However, it is essential to guarantee sustainability of monitoring, particularly in judicial terms, of current records. No debtor or counterparty must think that the time will play in his favour. "The COR remains as a legal structure to carry the residual assets and ongoing litigation. And establishing Public financing and restructuring (EPFR), which funded the release of the assets, still the shareholder. Its balance sheet remains completely separate from that of the CDC, specialist management for third parties, involved as claimant. It will invoice its services at cost prices.

Records "with issues".

After having "shrunk" its assets and debts, the CDR decreased volume of litigation. When Jean-Pierre Aubert took its functions, end of 2001, the CDR did more than about 13 of the assets of an amount of EUR 28.3 billion which it had been transferred to. Today, it is less than 2 (see chart). And the new governance will have to decide, from the statement made by the CDC quarantine files even with significant issues.

Among them, the records of the Bernard Tapie group. Jean-Pierre Aubert is the message: "the decision of the Court of cassation quashed the extravagant judgment of the Court of appeal condemning the CDR to pay compensation of EUR 135 million to the Tapie group liquidators has given us full satisfaction." If the liquidators want to make a proposal, it will be considered. But the COR asks nothing. "There is also a request from the Group of AIG American insurance, in the case of Executive Life. Two real estate records, including EALC in which is set a building in the heart of Manhattan, are likely to bring money into the CDR. Are also a few cases instruction for years.

Since its birth, the CDR has won half of its litigation; He has lost the tenth; in others, it interacted. In total, he has paid EUR 260 million of fees of lawyers, including 120 million for Executive Life. A case in which he had also to pay $ 600 million to implement rule with American justice. Not without being strong criticism, starting with those of Jean Peyrelevade, former boss of the Lyonnais, who found "only to American justice", according to the title of his book (1). Jean-Pierre Aubert response: "what is excessive is not important." As Charles-Amedee de Courson, UDF member and member of the Board of Directors of the EPFR, he believes that "a settlement, he had defended from 2000-2001, could save 500 to $ 600 million".

As complicated, the CDR has seen many others. At its inception, this "Monster" has collected 10,000 lines of assets, the thousands of claims, about 600 minority shareholdings and 56 majority shareholdings in companies employing 30,000 employees, but also 900,000 m2 of built land, including the headquarters of CAD/CAM or Lagardère, 45 hotels, 29 golf courses and 849 hectares of land to build in France and abroad. In fact, this inventory to the Prévert decomposed into thirds: real estate; the banking subsidiaries inherited from Altus and the cinema; Finally, a rather healthy equity portfolio. The heaviest records were in real estate and cinema, with including the

One "LBO" like no other

600 Lines of minority shareholdings were as much venture capital groups belonging to the CAC 40. With a presence in florets public or private such as aerospace, Alcatel, Bouygues, Rhône-Poulenc, Usinor, Total... But also in key holdings and non-rated of important businessmen (François Pinault, Vincent Bolloré, Marc of Lacharrière, Jean-Charles Naouri...), most often without liquidity clause, which seemed natural Credit Lyonnais, supporter of a "Bank-industry" that relied on a privileged relationship with a client. Under pressure from Brussels and competitors, investments went to the COR. Tensions sometimes occur between its teams and those of Credit Lyonnais, which remained in charge of the banking relationship.

In the triangle of the "hiving", the mission of the CoR was to limit losses for the taxpayer. In the beginning, which were foreseeable were listed without being provisioned. The interest of the editing "déconsolidant" was indeed to spread the burden over time, as the disposals and liquidations. What would perhaps be more possible with the new accounting standards. "The role of the CoR was to limit losses and not to make a profit.". This apart, it was a little the LBO of the century as leverage of the State guarantee has been masterful. "There has been enough to put a few tens of million of capital in the CDR to constitute a record of nearly $ 200 billion," says a former, wishing to remain anonymous. To redeem the stock of the Lyonnais, the structure of cantonment, alias CDR, borrowed from the public establishment EPFR. Itself is indebted to the Bank to the lion, who replaced risky by a quite safe debt assets.

An invoice with variable geometry

His debut, when she had to sell quickly and much, this huge "hiving" public has been the subject of political pressure, sometimes at the highest level. It was also under scrutiny by multiple instances of control. Starting with its Board of Directors and his committee assignments, but also its mission, the EPFR and control his guardianship, the Commission on privatization, the Inspection of finance, the Court of Auditors and, of course, Parliament. The most difficult assignments have involved the MGM studio, Artemis and Financière Pinault titles taken by EPFR to be transferred later or even the AOM airline company.

On small files, CDR seasoned leaders more than once had the impression of the blue. "Healthy companies refused to repay a credit under the pretext that the CoR was both the dustbin of Crédit Lyonnais and the deep pocket of the State", one of them recalled. And another to give: "It had to be armoured." Anyway, the headlines would say that it bradait, forgetting that the COR had bought assets at an overvalued price, express to save the Bank. We, there was an idea of their real value.

In real estate, Jacques de Peretti, the head of the pole, coupled to a great deal of reorganisation. And CDR real estate was selling when the market is left. These efforts have been beneficial. The COR believes each year its accumulated losses since the origin to the term loans, in 2014, based on those already épongées and those anticipated. This "global burden of cantonment" returned 14.7 billion euros end-1997 to 10.3 billion today. Explanation The output of a closely asset logic, the reduction in costs and the increase in the value of the assets. In total, management fees and lawyers ' fees are for about 15, or EUR 1.6 billion. Get the full support of the cantonment, to add some "non-quantifiable risks", EUR 653 million $ 568 million for the Executive Life case according to the latest statements to the EPFR. The Bill passes as to almost 11 billion for the cantonment. If one adds the financial costs incurred by the EPFR, is approached 18 billion...

Everything is complicated once sought to calculate the invoice of the rescue to the taxpayer! If you deducted the result of the privatization of the decreased the recapitalisations Lyon, it falls to some 12 billion euros. And it goes up around 16 billion that can be taken into account what remains to repay, or more than 4 billion. In 2000, a report of the Court of Auditors had made great noise. He estimated between 110 and 120 billion francs (in present value 1999) the cost of the "hiving", by deducting from the proceeds of privatization the value of the Crédit Lyonnais before the crisis, in 1990. A privileged observer believes that the State would have collected more if it had auctioned the Bank in 1999. Or if the COR had been privatized. Another thought that he would have less lost early enough by appointing ad hoc Agent under the Credit Lyonnais. In fact, there are almost as many modes of calculation that experts, means numbers that range from five to more than 20 billion euros. Not always devoid of ulterior political...