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Fagorbrandt (France) places organisation under legal protection order - De Dietrich UK remains autonomous
On Wednesday 6th November, FagorBrandt (France) took the decision to place the French part of the Fagor Group under the protection of the French legal system. Consequently, it has filed an application for insolvency in the Nanterre Commercial Court. This decision, which legally separates the activities of FagorBrandt (France) from Fagor Electrodomesticos (Spain) should allow the French business to continue to trade whilst endeavouring to safeguard jobs, together with the interests of its suppliers and partners.
Negotiations have been taking place over the past couple of weeks between the Mondragon Corporation (owner of all the different Fagor Group companies), the Spanish National Government, the Basque Regional Government and Fagor Electrodomesticos (Spain), with a view to restructuring its debt burden by fulfilling plans to move production 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, using current stocks of components or have closed. Talks are now at a critical stage, with Mondragon having rejected the initial viability plan to return Fagor Electrodomesticos (Spain) to profit in 2016. It is important to stress that while the current plan has been rejected, talks remain ongoing with all sides striving to overcome any obstacles. Negotiations are continuing 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 these negotiations. The UK business is therefore not directly affected by any insolvency decisions in either France or Spain. The company has maintained profitability for the past seven years and maintains adequate provisions to meets its obligations in terms of creditors, employees, customer service and warranties.
T: 01256 308 067
8th November 2013