MADRID Oct 16 Spanish loss-making consumer
appliance company Fagor filed for protection from
creditors while it tries to refinance its debt, the company said
on Wednesday, after suffering a prolonged period of falling
Fagor said in a statement it had begun "negotiations with
creditors to reach a refinancing agreement to guarantee its
Under Spanish bankruptcy rules it has four months to reach a
deal. Its total debt has risen to 1.1 billion euros ($1.5
billion) according to Thomson Reuters data.
The company, which says it is the fifth largest electrical
appliance company in Europe, started warning of liquidity
problems in 2009.
Fagor's annual sales of 1.17 billion euros in 2012 are down
by a third since 2007, the year that a decade-long real estate
bubble in Spain came to an abrupt end, triggering five years of
economic recession or stagnation.
The company had 5,642 employees as of June 30.
The number of insolvencies to end-September in Spain rose 27
percent to 6,582 compared with 2012, according to ratings agency
Axesor, as five years of depressed spending and gridlocked
lending from banks took its toll across sectors.
Basque Country-based Fagor is part of the Mondragon group,
the world's largest cooperative and long touted as a flexible
organisation that could easily adjust to Spain's economic
($1 = 0.7406 euros)
(Reporting by Clare Kane; Editing by Tracy Rucinski and Elaine