Strategic Treasury

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Interview – John Colleemallay Dassault Systems moved from a holding company treasury to a group treasury. The Director of Treasury and Finance explains the resulting organisation.

Interview - John Colleemallay

Director of Treasury and Finance, Dassault Systems

“We went from a holding company treasury to a group treasury”

La Lettre du Trésorier

Isn’t your company, Dassault Systems, about to celebrate an anniversary?

John Colleemallay

Yes, its thirtieth anniversary is very soon. It was in 1981 that a few engineers from Dassault Aviation started a business that would become the worldwide standard in its area of expertise, that is, product life cycle management (PLM). Dassault Systems’ software allows one to imagine, to simulate and to experiment with products in three dimensions. Dassault Systems today employs almost 9,000 people in over 80 countries. The company, which had a turnover of €1.3bn in 2009 and boasts an operating margin of 25%, has seen very sustained growth, marked by numerous acquisitions, mainly in the United States and in Europe. At one stage, it became necessary to consolidate the group, and, in order to do that, to move towards a convergence of management methods. That is the task of the aptly-named One Company which was set up three years ago and which, specifically in the context of the treasury, aims to rationalise banking, to put in place shared service centres and to centralise risk. In short, this means going from a holding company treasury to a group treasury which can have a precise and reliable vision when it comes to the generation of cash.

At the end of this transition to a centrally-driven treasury, can you describe the resulting organisation?

The treasury group, based in Vélizy, near Paris, at the worldwide company headquarters, is responsible for three large areas: market transactions – investments and foreign exchange transactions or front office; cash management and cash pooling, and finally a unit which manages reporting, control, analysis of financial results, large projects and the treasury’s IT systems. Additionally there is a treasury for the American zone, in Boston, and another in Asia, in Tokyo. These two treasury centres report back to the headquarters in Vélizy. We also have three shared service centres, focused above all on compatibility, in the United States, the United Kingdom and France.

What are the main tasks that you have been working on over the last few years?

Starting in 2007, we started to reduce significantly the number of our banking partners, so that for cash flow we only have two banks in the United States, two main banks in France and one in Asia. Shortly after that, in 2009, we began to tackle the formation of cash pools, one in Europe, outside France, co-ordinated with Société Générale, which was chosen after a call for bids, another in the United States with Bank of America, and a third in Japan with Bank of Tokyo-Mitsubishi UFG. The cash pool in France is managed by BNP Paribas. The final stage of this process of concentration of liquidity was reached in October 2010, when we put in place a worldwide cash pool co-ordinated by the Dutch bank BMG – Bank Mendez Ganz, a 100% subsidiary of ING – which allows us to centralise all our currencies without exchange rate risk and to manage our asset allocation exclusively in euro for all the group cash from our headquarters in France, with a more flexible market and better yields on investments than in America.

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