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White goods firm Fagor heading for bankruptcy

White goods firm Fagor heading for bankruptcy
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The future of Spanish loss-making consumer appliance company Fagor is looking increasingly uncertain.

Employees demonstrated outside their workplace with banners reading ‘Save our jobs’ on Thursday, but its parent company, the Basque cooperative ‘Mondragon’, has said it cannot rescue the group, which is seeking to refinance an estimated one billion euros of debt:

With recession hit Spain one of its main markets, Fagor has suffered falling sales of its appliances.

Parent group Mondragon said even if it were to stump up the cash it does not believe that would guarantee Fagor’s future.

Arantza Tapia, the economy minister in the regional Basque government, said if Mondragon does not believe refinancing Fagor would save it then there is nothing they can do either.

Fagor is Europe’s fifth largest manufacturer of household appliances with 5,600 employees in 13 factories in Spain, France, Poland, Morocco and China.

A bankruptcy would be a major blow to Mondragon, the world’s largest worker cooperative, which was thought to be flexible enough to adjust to Spain’s economic crisis.

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