Legal separation of FagorBrandt from Fagor Electrodomesticos
FagorBrandt in France has placed the French part of the Fagor Group under the protection of the country’s legal system and filed for an application for insolvency in the Nanterre Commercial Court.
This decision, which legally separates the activitiesof FagorBrandt (France) from Fagor Electrodomesticos (Spain) should allow the French business to continue to trade and to try and safeguard jobs.
Negotiations have been taking place over the past couple of weeks between the Mondragon Corporation (owner of all the Fagor Group companies), the Spanish National Governent, the Basque Regional Government and Fagor Electromesticos (Spain), with a view to restructuring its debt. It plans to move production of its appliances to low-cost countries.
While talks have been ongoing, all of the company’s French, Polish and Spanish factories have either been manufacturing at low volumes or have closed.
Mondragon has rejected the initial viability plan to return Fagor Electrodomesticos (Spain) to profit in 2016, however talks remain ongoing with a conclusion expected shortly.
De Dietrich Kitchen Appliances, which is responsible for De Dietrich, Fagor and private label business in the UK, operates as a separate legal entity and remains autonomous from the negotiations.
The UK business is not directly affected by any insolvency decisions in France or Spain and has maintained its profitability for the past seven years.