Dubai business jet manufacturer Emivest Aerospace, with facilities in Texas and West Virginia, has filed for US bankruptcy protection and is reportedly to be sold at auction next month.
Two years ago, Emirates Investment and Development (Emivest) purchased 80 per cent of Sino Swearingen Aircraft´s shares and renamed the firm Emivest Aerospace. A year later it vowed to inject US billion into the company to expand its product line.
In October however, the company filed for Chapter 11 protection in the US courts. Chapter 11 of the US Bankruptcy Code allows a debtor company to be shielded from creditor claims while it reorganises its operations. Emivest listed million of assets and m of debt.
"The global financial crisis has drastically reduced the demand for business jets, especially in the category of small and medium-sized jets, worth m to m," the company said in documents filed with the US Bankruptcy Court in the District of Delaware. "Given this current position, the company simply cannot continue to operate outside of Chapter 11," it said.
The company has asked the court to allow it to complete several aircraft under production, which it says will yield a net positive cash flow of .5m when the aircraft are completed within the next two years.