Insolvent airframer Fairchild Dornier has been granted a last-minute reprieve. A consortium of four creditor banks was due to close most of the company on 30 September, but has agreed to join German federal and Bavarian state authorities in creating a "transfer company".

Each party has provided €9 million ($9 million), which, together with €3 million from the European Union and g20 million from the federal employment department, will allow operations to continue for six months. Employees will work part-time for 67% of their former wages. The transfer company will initially employ 1,200 Fairchild Dornier staff, increasing to 2,100, including some already laid off, says employee representative Gunter Pfeiffer.

On 1 July Fairchild Dornier was declared insolvent and put into administration. Employees were paid 80% of their prior salary through a "social fund" arrangement with the German government, while administrator Eberhard Braun tried to sell the company to repay outstanding debts, held chiefly by four banks: Hypovereinsbank, KfW, LfA and Bayerische Landesbank. The reprieve has been agreed to buy Braun more time to find new buyers or investors for the company's various operations.

Despite the company's aerostructures and maintenance divisions apparently being profitable, Braun has been unable to sell them by the 30 September deadline. Russian group Sibal is interested in acquiring the 728/928 programme, but no serious bidders for the 328JET line have been announced.

Source: Flight International