How Moulinex ground to a halt
Legendary French marque Moulinex, once the reference in kitchen appliances, went bust with a bang last October. It was a shock to gourmets and cooks the world over, and more importantly a disaster for the company's 8, 800 employees. Peter Shard retraces the fascinating story of the success and failure of one of France's great industrial names.
In the 1920s, according to company lore, Mantelet, a gourmet himself, returned to France from a business trip to Germany with a new mechanical vegetable cutter as a present for his wife Fernande. But when it failed to work as planned, a disgusted Mantelet set out to design a hand-held device of his own.
He filed a patent for his invention on 16 February 1932 and introduced it to great acclaim at the Paris Fair that year. Despite its promising introduction at the fair, initial sales of the cutter, produced at a factory on the eastern outskirts of Paris, were sluggish and there was no hint of the global success that was to come.
Only 2,000 were sold in its first year on the market. But once the moulinette was improved - with circular discs and serrated surfaces to grate, slice, crush and mash all manner of vegetables and herbs, and sales took off.
In 1954 the company was baptised Moulinex, an adaptation of a French verb - mouliner - meaning to process or grind, and the name quickly became synonymous with the grater, achieving that rare status of being both a trade name and a generic term for the product.
Mantelet went on to coin the slogan Moulinex Liberates Women at a time when the domestic kitchen was still a largely female preserve. The firm went from strength to strength, producing the first electric mixer in 1961 and pioneering a line of food processors, electric coffee grinders and other labour-saving devices for which generations of aspiring cooks have reason to be grateful.
But as the gadgets became ever more sophisticated and efficient, the original moulinette never entirely lost its place in the market.
Even today, look through any kitchen drawer or cupboard anywhere in the world and there is almost certain to be a Moulinex food cutter of some description, sill in working order and in almost everyday use, never entirely abandoned even in the days of the high-tech robot chef and the computerised microwave oven.
But the company, which employs some 21,000 people, nonetheless ran into difficulties from about the time that Mantelet died without heirs 10 years ago, passing the business on to managers.
Following a merger in 2000 with Brandt of Italy, the company now has interests in 11 countries from China to Brazil. But it is also choked by debts of EUR 766 million (USD 682 million).
A long series of restructuring plans have been compromised by boardroom battles, objections by authorities and unions, and the Asian and Russian financial crises of 1998. Vast amounts of investors' money has been ground to nothing.
In July, 2000, Moulinex announced a plan to axe 2,100 posts, of which 1,700 were in France, in an attempt to remain competitive against stiff Asian competition. The company was forced to go to its shareholders in 2000 to raise EUR 128 million in fresh capital in a share issue. The stock was sold at a deep 40 percent discount to the market value.
Seeking a merger solution, the company looked at other European groups such as Seb of France and Braun of Germany but finally found a buyer towards the end of 2000: Italian group El.Fi, which controls the German household appliance maker Brandt.
El.Fi, owned by the Italian family Nocivelli, paid EUR 375 million to acquire Moulinex and owns a 74.3-percent stake in the merged group Moulinex-Brandt. Moulinex shareholders overwhelmingly approved the merger in December, 2000.
The rest is, perhaps, now history.