Proglio Drops Bid to Be Thales Chairman Amid Government Tussle

Henri Proglio dropped his bid to become chairman of French defense contractor Thales SA after the government voiced concern over a possible conflict of interest with another role he holds advising a Russian nuclear group.

The former Electricite de France SA chief executive officer retreated from the post following what he called a “‘rational decision,’’ according to an interview with Le Monde newspaper. The move came a day before Thales board members were due to appoint him as non-executive chairman.

‘‘At one point, I told myself ‘that’s enough’,’’ Proglio was cited as saying in the interview with the French newspaper. The executive didn’t return messages seeking comment.

The French state is Thales’s biggest investor, with a 26 percent stake. Proglio’s appointment had drawn scrutiny from the government, with Agence France-Presse citing Economy Minister Emmanuel Macron as saying that he faced a potential conflict of interest advising Rosatom, Russia’s national nuclear corporation while being chairman of Thales, which also advises French state-controlled utility Electricite de France.

Officials at Dassault Aviation, the second-largest investor in Thales after the state, and at Paris-based Thales weren’t available to comment. The move by Proglio is ‘‘morally right,” a French Economy Ministry official said.

Supporting Rival

Proglio had been jockeying for the chairman role at Thales with the backing of Dassault after French President Francois Hollande replaced him last year at the helm of EDF by Jean-Bernard Levy, who was previously Thales chairman and CEO.

Thales CEO Patrice Caine has been interim chairman since December.

Proglio had secured the nomination for the Thales job despite publicly supporting Hollande’s predecessor and rival Nicolas Sarkozy in the past. He had built his ties with Russia’s Rosatom during his previous role as EDF chief.

Macron wrote to Proglio, with the blessing of Hollande, to set out the government’s unease with his role at Rosatom, people familiar with the situation said last week, asking not to be named because the communication was private. In his letter, Macron argued that it’s not appropriate for the chairman of a French manufacturer of electronic-warfare systems to also advise the Russian government, the official said.

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