PARIS - French police interrogated a suspected Islamist Saturday as they tried to piece together an attack in which the man put his boss's severed head on display in the second jihadist attack to hit France in six months.
Prime Minister Manuel Valls, who cut short an official trip to South America to return home, warned that France faced more attacks and that Friday's assault on a gas factory near the second city of Lyon would increase tensions in the country and put citizens' resilience "to the test".
No jihadist group has claimed the French attack which came on the same day as a massacre at a Tunisian beach resort in which 38 people were gunned down and a suicide bombing in Kuwait that killed 27. The other two attacks have been claimed by the Islamic State group.
"Jihad Nauseum" headlined France's Liberation newspaper, warning of a new peak in the "global guerilla war launched by Islamist fanatics." A suspect, Yassin Salhi, 35, was arrested after causing an explosion by driving a delivery van into a warehouse containing bottles of dangerous gas and chemicals at the US-owned Air Products factory in Saint-Quentin-Fallavier, some 40 kilometres (25 miles) from Lyon.
The prosecutor in the case said Salhi was overpowered by firefighters as he was trying to open acetone bottles in what is believed to have been an attempt to cause a larger explosion.
The firefighters then discovered the decapitated body of his 54-year-old boss Herve Cornara - who ran a delivery firm - near the car, along with a knife.
The victim's head was pinned to a nearby fence.
"The head was surrounded by two Islamic flags bearing the Shahada, the profession of (the Muslim) faith," said prosecutor Francois Molins.
The gory attack in France came nearly six months after a three-day Islamist killing spree in Paris left 17 people dead, most of them gunned down in the editorial offices of satirical magazine Charlie Hebdo.
Like the Charlie Hebdo attackers and Islamist Mohamed Merah who gunned down soldiers and Jewish children in a 2012 attack in the southwest city of Toulouse, Salhi had been known to security services for "radicalisation", but slipped through the cracks.
Interior Minister Bernard Cazeneuve said Friday the married father-of-three had been investigated for links to radical Salafists in Lyon, but was not identified as having participated in terrorist activities and did not have a criminal record.
Speaking after a ministerial meeting on Saturday with President Francois Hollande, Cazeneuve vowed the government would "continue to work relentlessly" against terrorism.
France is on high alert over hundreds of citizens who have gone to wage jihad in Iraq and Syria, as well as those involved in recruitment or radicalisation online.
Cazeneuve outlined measures taken by the government in recent months to face "a threat which has never been as high" such as the creation of hundreds of new jobs for police, gendarmes and intelligence agents.
Some 230 million euros (S$347 million) will also go to modernising surveillance methods to keep track of jihadists online.
Earlier this week, France passed a controversial new spying law granting sweeping powers to snoop on citizens.
Cazeneuve said the law allowed security services to be "better armed" to fight the jihadist threat
More attacks likely
Valls warned Friday's attack would fuel tensions in France - home to Western Europe's largest Muslim population - that "will be exploited".
"It's difficult for a society to live for years under the threat of attack," he told AFP on a flight back from Colombia, adding: "The question is not... if there will be another attack, but when." "This macabre act of decapitation, staged with flags, is new in France" and aimed at "making an impact," Valls said.
Beheadings have in recent times become a trademark of the Islamic State group in Iraq and Syria.
'Wolf in sheep's clothing'
Salhi was described by a co-worker as "a wolf in sheep's clothing" to RTL radio, adding that Salhi had spoken to him about Islamic State - "not to try recruit me for anything but simply to ask my opinion".
The prosecutor said Salhi's wife, sister and another man had also been taken into custody.
The second man is being investigated on terrorism-related charges but his link to the attack is not clear, and Molins said there was no indication that Salhi had an accomplice with him.
For months, Europe has been on high alert for so-called "lone wolf" attacks by supporters of Islamic State, which has urged its followers to strike wherever they can.
France has been on edge since January 7 when two Islamist brothers attacked the satirical magazine Charlie Hebdo, killing 12 people.
A policewoman and four hostages in a Jewish supermarket were killed by another jihadist Amedy Coulibaly, in three days of attacks which ended with the police killing the three Islamists.