In addition, the Arelec Araymond company (13 employees), managed by Thomas Donjon and whose activity is 90% dependent on Arelec’s, was placed under receivership by the Commercial Court of Pau for a period of six months.
After being part of UK holding companies until 2004, Arelec became independent again and has been managed by Nicolas Donjon since 2006, who bought the company with an investment fund and set out an ambitious growth strategy. Arelec specializes in the manufacture of magnetic components and modules for the automotive, aerospace, furniture and advertising sectors and has increased its turnover from 10 to 20 million euros in just a few years after overcoming the 2008 automotive crisis.
Depressed by the Covid
But in 2016, Arelec (which also employs 85 people in Tunisia) is hit by financial difficulties. The Lonsoise company is placed under receivership. In 2018, the Pau Commercial Court upheld a continuation plan. But Arelec is affected in 2020 by the crisis related to the coronavirus. Half of the employees will be placed on part-time jobs. The court validated a new recovery plan for a period of 10 years, intended to settle liabilities of more than 10 million euros.
But liquidity problems persist and the international situation (dependence on China, commodity prices) does not favor the company’s activity. Nicolas Donjon also mentions “the catastrophic increase in transport costs and delays between the summer and last spring”. “There was also the deterioration of the euro,” he adds. “Paradoxically, we have an order backlog that may have never been higher,” he explains. But we would need even more raw materials to fulfill them and even more working capital to meet the deadlines.” “All of this put us in a very fragile situation,” sums up Nicolas Donjon.
signs of recovery
As of July 5, the company’s liabilities were still more than 10 million euros. And only 30% of salaries could be paid in July. The judicial liquidation will allow the AGS, the wage guarantee institution, to pay the remaining 70% in the coming days.
No comment this Thursday from workers’ representatives, the latter confining themselves to pointing the finger at “the management of the management”.
On the side of the latter, CEO Nicolas Donjon confided that he was deeply affected by the situation: “It’s the worst month of August in our lives, but we have to face it.” Despite remaining cautious given the situation, it was on quite confident this Thursday of a possibility of recovery. “We have very interesting markets, especially among car manufacturers.” With the rest of the possibilities of exploitation, as stipulated by the judgment of the Commercial Court. Nicolas Donjon confirms: “We have been in talks with potential buyers for two years.” So maybe the story isn’t quite over yet.