Case | HBS Case Collection | April 1988 (Revised May 1992)

Gaz de France

by W. Carl Kester


The treasurer of Gaz de France is an aggressive, proactive manager of his company's liability structure, running one of the largest swap books of any non-financial corporation in the world. Currency futures, interbank forwards, and currency options are also frequently used to control the company's multi-currency liability structure. This case prompts students to explore the reasons and ramifications of such aggressive liability management, with particular attention being paid to the administrative challenges created by such a large swap position. An important decision has to be made regarding the management of the swap book in the face of the depreciating dollar, the decline of the franc against the German mark, and a possible realignment of the European Currency Unit. This is a comprehensive case involving swaps, debt policy, and foreign exchange exposure that is best taught after students have been introduced to these topics.

Keywords: Decisions; Borrowing and Debt; Currency Exchange Rate; Credit Derivatives and Swaps; Policy; Management; Organizational Structure; Energy Industry; Europe;


Kester, W. Carl. "Gaz de France." Harvard Business School Case 288-030, April 1988. (Revised May 1992.)