Néoform Industries, a subsidiary of Néoform Participations since 2000, was formed from the merger of family businesses specialising in the design, manufacture and marketing of kitchen and bathroom furniture in kit or assembled form, intended for DIY shops and the distribution of building materials to professionals.
Pyram, a designer and manufacturer of kitchens and bathrooms, joined the Néoform Participations group in 2012 to become the premium branch of the group’s mass market activities.
In 2015, Neoform had a turnover of EUR 25 million and approximately 230 employees at 5 sites in France, while Pyram had a turnover of EUR 13 million and approximately 170 employees at 1 site.
The management of these two sister companies was carried out by a single manager.
Three years after the Pyram acquisition, the performance of both companies deteriorated severely, leading not only to a risk of default on the group’s LBO debt but also to a risk of corporate default.
In February 2016, at the request of the shareholders, the incumbent manager appointed Prospheres to succeed him at short notice.
The innovative and ambitious MRI analysis of the performance of both companies, which Prospheres systematically carried out, combined with a careful analysis of the markets served by NeoForm and Pyram, revealed the need to:
- reduce the range of products by removing those that customers would only buy on the cheap,
- develop new strategic business areas such as the installation of kitchen and bathroom furniture on construction sites run by developers,
- develop new sales channels: direct sales to individuals via the Internet, acquisition of own shops, sales via craftspeople and interior designers,
- renegotiate prices of products for DIY stores and stop marketing to unprofitable customers,
- reallocate sales forces,
- reorganise production by eliminating one site and specialising the others,
- improve the productivity of furniture assembly lines and internalise part of the manufacturing process,
- initially, make each of the two companies autonomous, with mutualisation limited to certain functions.
These reorganisations required the implementation of two staff reduction projects affecting support teams and middle management in addition to the staff affected by the closure of a production site.
Bank debt was renegotiated to make it compatible with the new business plan developed jointly with the employees. Shareholders reinjected the new money needed to finance the business plan developed by the teams of both companies under the leadership of Prospheres dirigeants and the banks agreed to reschedule the debt.
Néoform, whose employees have demonstrated considerable support for the management model implemented by Prospheres dirigeants, that of subsidiarity and individual responsibility, has returned to an exceptional level of profitability, exceeding the business plan.
Pyram was subject to a continuation plan as part of a receivership procedure in 2018, and returned to profitability in accordance with the business plan, but with a one-year lag.
These good results have enabled the teams of both companies to strengthen the synergies between them with complete peace of mind, further improving the performance of the entire group.
As part of its succession, Prospheres dirigeants gradually stepped aside to remain only a non-executive president, promoting 2 executives to the positions of managing director and deputy managing director respectively. The strategy and policy under the general management of Prospheres dirigeants has been continued.
In 2021, the shareholders initiated a sale process that Prospheres dirigeants accompanied, a process that enabled the shareholders to recover their initial investment and generate a significant capital gain on the new money of 2016.