Chirac's Lightning Strike

Two moves will shake up the bloated defense industry

Arms makers around the world have long wondered when France would join the industry trend and consolidate its defense companies. On Feb. 21, President Jacques Chirac at last made his move: Turning merger broker, he strongly urged the nation's two big aircraft builders--state-owned Aerospatiale and family-controlled Dassault Aviation--to fuse within two years. At the same time, he ousted CEO Alain Gomez of state consumer-and-defense electronics giant Thomson and announced plans to sell the company by yearend.

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