Alno German Kitchens file for insolvency but insist business as usual

Alno German Kitchens

Alno AG has reassured dealers that business remains “unchanged”, despite filing for insolvency on July 11.

The application for reorganisation with self-administration has been made for the companies Alno AG, Wellmann GmbH and Logistik & Service GmbH, which is also thought to include the franchise brand of In-Toto in the UK, all of which owe their ultimate ownership to Whirlpool Corporation.

In a statement from Alno is was suggested that “..all other subsidiaries in Germany and abroad, including Pino Küchen GmbH, are not affected by the application, Alno AG’s Board of Directors wants to continue the reorganisation measures initiated at the beginning of the year and secure the turnaround.”

According to the well known German kitchen brand the board of directors had to put forward the application for self-administration to Hechingen Local Court, despite seeing recent “operational successes” brought about by its restructuring measures which came as a blow to Alno’s thousands of employees and retail partners.

The decision was thought to have been as a direct result of the high financial liabilities and the interest payments involved, and the recent failed negotiations held with potential investors and creditors during the restructuring process.

Despite the directors stating that the measures implemented within the Alno group at the start of the year are now “bearing fruit” and have seen the deficit in Germany fall by €8.7 million (£7.7m) – from €10m in 2016 to €1.3m by the end of May 2017 the reality was that more needed to be done to satisfy the investors and creditors.

Alno AG said it now hopes to take advantage of the benefits introduced by the ESUG in 2012 – German Act on the Further Facilitation of the Restructuring of Businesses – and continue business operations after completion of the restructuring measures.

The factories involved in the re-structure are thought to represent some 22% of all Alno UK purchases but the UK subsidiary has confirmed that orders will not be impacted by the restructure but as of yet, no word has been given as to Alno’s generous 5 year guarantee and whether any terms of this will be affected, although on the Alno website the guarantee is still in effect, which may reassure those whom have recently ordered an Alno kitchen, or have done so in the last 4 years.

In its statement Alno said: “Alno UK has a long-standing reputation and successful trading history through its UK retail, franchise and contracts divisions. It will proceed as normal with the continued support of its business partners. The affected German factories are still operating, orders are continuing to be fulfilled and taken, and Alno UK’s direct relationship with its logistics supplier means that its delivery process is also unaffected.

“The Alno UK directors are doing everything possible to facilitate a smooth continuation of service for its business network and consumers.”

The Kitchen Bathroom Bedroom Specialists Association, (Kbsa) has offered support to In-toto and Alno retailers following the news that Alno AG has filed for insolvency in self-administration but someone who remains somewhat skeptical is Sven Herden, Häcker’s UK managing director whom claimed to kbbreview that it was unlikely the UK Alno business would be completely unaffected by the insolvency.

“In my opinion this will have an impact on all their customers,” he said. “The UK subsidiary might not be officially affected by the insolvency but from whom are they buying their kitchens? However, I don’t think the name Alno will totally disappear, but I’m not sure about Wellmann.”