Mail order company La Redoute will live on after the largest labour union has now accepted the plan after the court had almost bankrupted the company.
Take-over deal hanging by a thread
Nathalie Balla (La Redoute CEO) and Eric Courteille (Redcats CFO) had announced in December they would put in an offer on La Redoute, as Kering (former PPR) wanted to get rid of the company and had put the onerous French mail order up for sale.
The duo topped three other candidates as they know the company and more particularly the labour unions through and through. Balla and Courteille will pay a symbolic euro for the necessitous company and Kering will add 520 million euro to that, with 320 million euro to transform the group logistically.
The other 200 million euro will be used to soften the social blow as the new owners' reorganization plan will cut 1,178 out of 3,437 La Redoute jobs and 172 out of 569 jobs at affiliate company Relais Colis.
There was one condition to get that money: the labour unions had to sign the social agreement and because that signature did not come, an ultimatum was given. If the signature failed to arrive by last Friday, Kering would not hand over the money and Balla-Courteille would refuse to purchase the company. That would have meant La Redoute would have to go bankrupt.
CFE-CGC had signed on Thursday, but CFDT refused, which angered a large part of the employees as they feared for a social blood bath. The labour union leader even received death threats and had to be given police protection.
In the afternoon, it was stated that the labour union had asked the courts to postpone a decision until Monday. If no agreement had been reached by then, a liquidator had to go to work, but CFDT folded on Monday after it had managed to get additional promises during the weekend.
That means La Redoute can continue, with Kering signing the sale by the end of April to allow Nathalie Balla and Eric Courteille to start their industrial project, which is based on a "rather realistic business plan, with losses in the first two years, but an actual restart after that". That is the hopeful message out of Northern France.