On Friday, a French commercial court chose Nowy Styl Group’s offer to become an investor in Majencia, a company in bankruptcy. The European office furniture giant will take over plants in Noyon and Bressuire, and hire most of Majencia’s staff. Setting up of a new company is expected to help heal the French company and restore it to a leadership position on the French office furniture market.
The completed transaction is another West-European acquisition by the Nowy Styl Group, after it took over a German company Kusch+Co this year, a Swiss company Sitag in 2015, a company operating in Germany and the Netherlands Rohde & Grahl in 2013, and a German brand Grammer Office in 2011.
Restore Majencia’s strength
“We keep investing in the development of our Western European markets. We have been present in France for nearly 20 years, but by taking over Majencia we are going to take number one position in a country which is a major European market, next to Germany. We believe that a capital injection into Majencia’s business, our company’s global scale of operations and our experience in the integration and optimization of business processes will help restore Majencia’s strength” said Adam Krzanowski, the President of the Nowy Styl Group.
From a leadership position
Majencia used to be number one on the French office furniture market for many years. In 2017, the company’s turnover still exceeded 100 million euros, but for the past several years Majencia faced financial problems which lead to the opening of bankruptcy proceedings against the company. Despite the many restructuring measures taken, in April the company was declared bankrupt and the liquidator looked for new owners with an idea to heal the company. Its future was to be decided by the Commercial Court in Nanterre, which chose Nowy Styl Group’s offer last Friday out of three submitted bids to take over the company.
Business development plan
“As stated in our offer, we are taking over the assets of the French manufacturer for half a million euros. Then, to give Majencia a new life, we are going to set up an entity called Nowy Styl – Majencia, with a capital of 10 million euros and debt funding of 9.5 million euros. According to our calculations, these amounts will allow Majencia to go back on the leadership position” said Rafał Chwast, Vice-President and Finance Director for the Nowy Styl Group. „We also want to keep as many jobs as possible, but appropriately for the present scale of the company’s business in France.”
Nowy Styl – Majencia will hire 266 employees from the French manufacturer’s former personnel. Further expansion of the team will be gradual, in line with the growth of the business.
The new company will also naturally continue to deliver Majencia’s long-term contracts for its key customers in the public and private sectors.
“We know Majencia’s potential in the French market. The trust the company has won among the local customers with its many years of experience is invaluable. As we carried out due diligence of the company at the tendering stage, we identified areas that we can significantly improve, given the scale of operations and expertise of our company. What I mean here is Nowy Styl Group’s wide and dynamically expanded range of products, which can be an attractive complement to Majencia’s range. So far, one-quarter of Majencia’s sales in France came from products purchased from other manufacturers. I think now we will fill that gap with our own solutions” says Roman Przybylski, Member of the Board and Sales Director for the Nowy Styl Group.
‘Exciting challenge for this new company’
The development plan for Majencia also includes improving the efficiency of logistics, organisation of production and implementation processes for new products. Many components which were so far purchased from external suppliers will now be sourced by Nowy Styl – Majencia from its own plants, mainly in Poland, at lower prices.“We are very happy that the Court made the decision to select Nowy Styl Group to take over Majencia. Being part of the most solid and successful European leader is a chance for Nowy Styl – Majencia to become a leader in France after successful recovery from Majencia’s situation, which unfortunately deteriorated rapidly in the past months. Our priority now is to be back on the market and convince our customers to renew their confidence in us which they had before our difficulties. This is a new very positive era, which will mobilize all the 266 people who are part of this new company to face an exciting challenge” comments Vincent Gruau, Majencia’s owner and President who is going to remain in the structures of the new company.