Mondragon boss quits after Fagor failure

Spain's sprawling conglomerate Mondragon, which employs 80,000 people worldwide, announced Friday the resignation of its president, Txema Gisasola, and the opening of a "period of reflection" in the face of economic troubles.

Mondragon boss quits after Fagor failure
Workers of electrical appliance maker Edesa-Fagor arrive northern Spanish Basque city of Mondragon on December 4, 2013. AFP Photo/Rafa Rivas

Gisasola's departure comes two months after Mondragon's loss-making electrical appliance making unit, Fagor, employing 5,700 people internationally, filed for bankruptcy.

"Txema Gisasola has resigned as president of the general council for personal reasons," Mondragon said in a statement.

Mondragon, made up of workers' cooperatives operating worldwide in industry, retailing and finance, said it was opening a period of analysis to decide a framework for action over the next few years.

"In the current situation of economic crisis, Mondragon Corporation believes it is necessary to undertake this period of 'collective analysis, reflection and debate' in order to tackle confidently the challenge presented by the global economic crisis," it said.

A new president would be chosen after the period of reflection, Mondragon said.

Mondragon, based in a small Basque town of the same name, was founded by a local priest, Jose Maria Arizmendiarrieta, as a small workers' cooperative and
is now an international conglomerate with a mission of maintaining jobs.

Despite its international presence, Mondragon's cooperative structure has kept most of its jobs and production at home.

Most of its workers are partners in the firm, voting to elect the bosses and make sensitive decisions.

Mondragon said there was no possibility of changing its cooperative model.

"The corporation completely reasserts its trust in the cooperative model as a driving force for generating wealth and is firmly committed to the future of the community it is part of," it said.

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