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Thales names interim CEO, Safran mulls dual leadership

By Cyril Altmeyer

PARIS (Reuters) - France's Thales named group secretary Philippe Logak as its temporary boss on Thursday after its main shareholders failed to resolve a dispute over the succession to Jean-Bernard Levy, who has resigned to run France's top power firm.

Dassault Aviation and the French government, with 26 percent and 25 percent respectively, are split over whether to give the job of running Europe's largest defence electronics firm to an internal candidate, sources close to the matter have told Reuters, with Dassault preferring an external candidate.

A day after Levy was officially confirmed as the new head of EDF , Thales said its board had chosen Logak, who is also its general counsel, as interim chairman and chief executive.

Thales shares closed down 1.2 percent after the news, against a slightly stronger market.

White-collar union CFE-CGC said the failure to announce a long-term successor to Levy displayed "managerial neglect".

It is not the first time the French government and Dassault have quarrelled over who should run Thales, which makes military and civil radar and owns a stake in France's naval shipyard.

Levy's predecessor Luc Vigneron was a compromise candidate after a similar shareholder split.

In a sign of the uncertainty surrounding Thales, Logak's appointment followed a board meeting originally scheduled for Monday, then Wednesday, and finally Thursday.

Negotiations appear to have been complicated by Dassault's anger at not being informed in advance of the government's unexpected decision to transfer Levy to EDF after two years at Thales, which had stabilised under his charge.

One person with direct knowledge of the situation said Dassault felt it had been presented with a "fait accompli".

Logak, a former arms engineer and lawyer who joined Thales in 2013, will head the firm for at least two weeks and until the end of the year at most, a source close to the matter said.

SAFRAN SUCCESSION LOOMS

The vacancy at Thales comes as another partially privatised French aerospace and defence group, Safran , also faces a change of leadership when Chairman and Chief Executive Jean-Paul Herteman reaches the end of his mandate next year.

A source familiar with the matter said on Thursday Safran could split the role into two, restoring a governance structure in place until 2011, confirming a report in L'Express.

According to the French magazine, such a move could see Finance Director Ross McInnes become chairman and Philippe Petitcolin, head of the Morpho division and former boss of the flagship Snecma engine division, appointed as CEO.

"It is one of the options being seriously looked at, but it is not at all confirmed," the source said.

Also included in a shortlist in circulation, the source said, are Antoine Bouvier, head of missiles firm MBDA, and the strategy chief of Airbus Group , Marwan Lahoud, although Lahoud recently ruled out such a move.

Safran declined to comment.

(Writing and additional reporting by Tim Hepher; Editing by Elaine Hardcastle and Mark Potter)