Fagor’s Polish Unit Seeks Creditor Protection in Spanish CourtManuel Baigorri
Fagor Electrodomesticos Soc. Coop., an employee-owned appliance maker based in Spain’s Basque Country, said its Polish unit sought creditor protection while the parent continues to negotiate with lenders.
Fagor Mastercook SA filed for protection at a court in San Sebastian, northern Spain, according to a statement to regulators today. The parent company remains in talks with lenders, after seeking preliminary creditor protection Oct. 16.
The number of Spanish companies in bankruptcy proceedings rose 15 percent from a year earlier in the second quarter, government data show, as banks continued to rein in lending and the economy struggled to emerge from a two-year recession.
Zinkia Entertainment SA, the producer of children’s TV show Pocoyo, sought preliminary protection from creditors today after pulling a bond issue, and Service Point Solutions SA took the same measure last week.
Fagor has 850 million euros ($1.16 billion) of debt as of June 30, Elena Goirizelaia, a spokeswoman for the company, said in a telephone interview. That figure includes 185 million euros of subordinated debt. Debtholders include workers of Fagor, who at the same time are partners of the company, she said.
Fagor is owned by Mondragon Corp., a closely-held cooperative conglomerate. Its products include washing machines and pressure cookers, with most revenue coming from foreign markets. International sales account for 76 percent of revenue, compared with 24 percent from Spain.
The potential closure of Fagor would mean about 10,000 job losses, including 5,600 Fagor staff and more than 4,000 staff at suppliers, Cinco Dias reported today, without saying how it got the information.