Arc International: sale of Spanish plant to local management

Arc International Group informed the employees and the management of its Spanish plant that it would not be investing in the rebuilding of the two furnaces after they reach the end of their lifecycle …

Arc International Group informed the employees and the management of its Spanish plant that it would not be investing in the rebuilding of the two furnaces after they reach the end of their lifecycle (2011 for Furnace 2 and 2013 for Furnace 1). This difficult decision was the consequence of decreased demand on the European tableware market, leading to industrial overcapacity in this region, where the Arques (France) site alone can meet the demand for sodocalcic and opal glass. Subsequent to this announcement and since no external solution could be found to guarantee the future of Vicrila and its employees, Luis Fernandez, managing director, and two other managers proposed a Management Buy Out (MBO) of the company. This project was completed on 30 December 2009 as an agreement was signed between the Spanish management team and Arc International with the support of the local Basque and Central Governments. According to the conditions of the agreement, the Group: – will continue using Vicrila production capacities as part of a sourcing contract up to 2011 for Furnace 2 and up to 2013 in a decreasing way for Furnace 1; and – will provide technical assistance to the new company till the end of the sourcing contract. Guillaume de Fougires, Chairman of the Board of Arc International attended the signature of the contract and declared: “I am pleased we could come up with a solution that guarantees the sustainability of this site in the respect of our Group“s social values. Luis Fernandez and his team are renowned businessmen who will be able to define the business model of the new company in relation with Arc International and its other clients. I would like to emphasize the role of the Basque and Central Governments which supported the project from the beginning. I wish Vicrila and its employees all the best for the future.”