France's Reims Aviation saved from bankruptcy

Reims Aviation, one of Europe’s few remaining independent light aircraft manufacturers and subcontractors, has been saved from bankruptcy.

By Jeff Apter

October 12, 2007

Reims Aviation, one of Europe’s few remaining independent light aircraft manufacturers and subcontractors, has been saved from bankruptcy. The Reims, eastern France commercial court lifted the bankruptcy protection order on the company but said it should be broken up and sold in two parts, with 164 of the 461 employees losing their jobs.

Paradoxically, the company was doing well. Despite a healthy order book, Reims Aviation, which last year reported revenues of E42 million ($40 million) went into bankruptcy protection on October 30 following a cash-flow crisis brought about by financial difficulties over its aerostructures contract with Fairchild Dornier, the bankrupt regional jet manufacturer for which it had been building tooling and rigs for the 728/928JET. It also suffered financial penalties caused by late delivery of the F406 Caravan II surveillance aircraft for the Greek Navy. The company was due to have been taken over in its entirety by Wagrapar, but the French financial group failed to receive the necessary bank support and withdrew its offer.

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