Victim decapitated in French attack was local businessman

UPDATE: The victim of today's attack at a gas factory is believed to be the owner of a local transportation company, according to a security official. Police found the man's severed head on a fence outside the factory, but investigators believe he was killed elsewhere.

Security officials have made several arrests in connection with the attack but have not released any details about the suspects.

OUR EARLIER REPORT (8 a.m. EDT): French police have arrested one suspect and are looking for another after someone crashed a car through the gates of a gas factory, sparking an explosion. Several people were injured in the attack, and police found a decapitated head on the facility's exterior fence. They also found two flags—one white and one black, both with Arabic writing—near the body.

Initial reports indicated two men were involved in the attack, which took place at about 10 a.m. local time near Lyon, in the southeastern part of the country.

The person arrested, who has not yet been named, was known for possible ties to Islamic extremism but had no arrest record. Investigators first flagged the suspect for terrorist ties in 2006 and stopped monitoring two years later.

French President François Hollande called the incident a “terrorist attack,” although his interior minister cautioned against jumping to conclusions too quickly.

The Associated Press contributed to this report.