Worms et Cie History
Telephone: (33) 18.104.22.168.00
Fax: (33) 22.214.171.124.83
Sales: FFr 1 billion (US$ 207.7 million) (1996)
Stock Exchanges: Paris
Ticker Symbol: Worms
SICs: 6719 Holding Companies, Not Elsewhere Classified
One of the most illustrious names in French financial history, Worms et Cie has functioned since the 1980s primarily as a holding company for various investments along two primary lines: insurance and industrial agrochemical, with an emphasis on paper and sugar production. In the late 1990s, however, Worms et Cie has undergone an important transition. After being attacked in a hostile takeover attempt by François Pinault, of the Artémis Group and Pinault-Printemps-Redoute, the formerly independent, family-controlled investment firm agreed to sell its Athena insurance subsidiary to Assurances Generales de France (AGF), a longtime investor and ally. At the same time, Worms et Cie agreed to be acquired&mdashøgether with its remaining holdings, including its controlling shares of the Saint Louis industrial group and the Arjo Wiggins Appleton paper group--by Someal, an investment partnership controlled by another longtime Worms et Cie ally, the Agnelli family of Italy, via its Ifil investment vehicle. Someal is comprised of Ifil and members of the former shareholding group of Worms et Cie.
With an estimated worth of more than FFr 30 billion in 1998, Worms et Cie retains control of Saint Louis, the second largest sugar producer in France, as well as a controlling share of the Arjo Wiggins Appleton paper manufacturing group. Worms et Cie has not entirely abandoned its financial investment wing, retaining its control of the Permal Group, a New York-based investment fund management firm. The change in the structure of the company, which had been operated as a limited partnership--chiefly among Worms and related founding family shareholders--throughout the company's 150-year history, marks a new era for the holding group. The company will also enter the year 2000 without a Worms family member at the helm; the last of the founding family directors, Nicholas Clive Worms, relinquished his active participation in Worms et Cie's daily operations at the time of its acquisition by Someal. Longtime Worms et Cie director Dominique Auburtin remains the company's chief executive.
The new Worms et Cie enters the liberty of the free market with an absence of debt, a war chest of some FFr 4 billion, and a strengthened management. With its focus no longer split between insurance and industry, Worms et Cie is expected to continue building its industrial portfolio.
Coal Beginning in the 19th Century
The acquisition of Worms et Cie by Someal marked the end of more than 150 years of active Worms family leadership in the company that bears its name. Although the family would come to represent the new French financial "nobility" in the 20th century, Worms et Cie had decidedly common origins. Born in 1801, Hypolite Worms, a wholesaler and shipping agent, opened an office in Paris in 1841. The end of the French monarchy, reestablished on the heels of the French revolution, was once again in the air, falling before the brief civil war of 1848. In that same year, Worms, together with a number of associates, the families of whom would remain shareholders in the company until the end of the 20th century, began importing English coal to France.
Worms and his associates reorganized the company, forming Worms et Cie, a limited partnership that remained in place until the mid-1990s. Among the features of this partnership was a pyramid-like structure of a small number of directors. For much of the company's history, these directors were also among the company's capitalists. As Worms et Cie diversified over the decades, individual directors typically became responsible for a particular branch of the company's development. For much of the company's history, however, a member of the Worms family provided the company's leadership.
The end of the 1848 civil war led to the creation--and brief existence--of the Second Republic. One of the preoccupations of the new civil government was the rising rate of unemployment, particularly in the Parisian region, as the provincial population began a shift to the city center. The government created "national workshops" (ateliers nationaux) with the goal of providing work for the country's unemployed. While this policy had the effect of attracting still more of the population to the capital city--and further exacerbating the unemployment problem--the availability of a cheap and abundant labor force and the rise in industrial activity came at the right time for Worms et Cie and its coal import business.
Worms et Cie prospered, and continued to see its fortunes--and financial influence--rise, even after the foundering of the Second Republic and the rise to power of Emperor Napoleon III in the formation of the Second Empire in 1852. Under Napoleon, the industrialization of France took on a new pace, fueling the demand for coal--and the growth of Worms et Cie. France's increasingly international interests, in parallel with Napoleon III's belligerence, led Worms et Cie to develop a new direction: that of shipping operations. Launched in 1856, the shipping wing of Worms et Cie soon became its principal activity and led the company to expand its operations on an international level.
The company's first foreign office was opened in Port Saïd, Egypt, in 1869. The company's operations soon spread throughout northern Africa, especially among France's zone of colonial influence. By then Hypolite Worms was preparing to pass on the company's leadership to the next generation, his nephew Henri Goudchaux. Under Goudchaux, Worms et Cie's shipping empire took on an even greater influence, even as Napoleon III's empire collapsed, replaced by the more durable Third Republic.
While coal-burning steam engines had provided the backbone of the Industrial Revolution, the end of the 19th century saw the emergence of a new type of engine requiring a new type of fuel
- Abescat, Bruno, "Le retour des Worms," Nouvel Observateur, May 29, 1987, p. 45.
- Almi, Jannick, "Worms et Cie: la contre-attaque des AGF," La Vie Françse, October 11, 1997, p. 14.
- Bertier, Etienne, "Les Volte-Face de MM. Worms," L'Expansion, April 1, 1988, p. 201.
- Chaperon, Isabelle, "Worms & Cie: une mutation conduite à pas comptés," Les Echos, September 22, 1997, p. 27.
- Chevrillon, Hedwige, and Yannick Le Bourdonnec, "Worms, le retour aux valeurs familiales," L'Expansion, July 17, 1993, p. 118.
- Denis, Anne, and Pascalle Santi, "Worms et Cie: l'avenir d'Athena au centre de la strategie," Les Echos, February 25, 1997, p. 17.
- "Le nouveau Worms & Cie affiche une stratégie centrée sur l'industrie," Les Echos, September 5, 1998, p. 22.
Source: International Directory of Company Histories, Vol. 27. St. James Press, 1999.