SPn developer officially declares insolvency

 - December 1, 2008, 5:49 AM

Grob Aerospace GmbH was formally declared insolvent on November 1. This happened almost 11 weeks after the German manufacturer filed for preliminary insolvency on August 18 following the sudden withdrawal of its main financial backer. Its Swiss parent, Grob AG, was also declared insolvent a few days later in early November.

At press time, German insolvency administrator Dr. Michael Jaffé was expected to resolve Grob Aerospace GmbH’s future within 30 days, by early this month. On November 17, Grob CEO Niall Olver told AIN that, with the company now insolvent, the situation is more of a “clean slate” in which it might actually be more straightforward for one of the parties that has been interested in buying all or part of the firm to close a deal.

Most employees at Grob Aerospace GmbH’s factory at Mattsies in southern Germany were laid off on November 3. To ensure that salary payments for August through October were made to these employees, Grob had no alternative but to file for full insolvency. A core team has remained in Mattsies to keep the operation active on a minimal scale.

Under both German and Swiss bankruptcy laws, Grob essentially ran out of time to find new investors while remaining temporarily protected from full insolvency terms.
In October, Olver had indicated that more than e100 million ($128 million) of new capital would be required to get Grob up and running again. This amount would both replace funds withdrawn by the company’s undisclosed main investor in mid-August and provide additional money to cover the cost of completing SPn certification. The confirmation of insolvency legally dissolves all existing contracts for the SPn, more than 100 of which had been ordered. However, Olver said that only one customer has asked to cancel his order and that the others have indicated they would still be willing to buy the aircraft if Grob can be resurrected. One of the program’s main customers is Portsmouth, N.H.- based Alpha Flying’s PlaneSense fractional ownership program with a firm order for 25 SPns.