Fri, 01 Nov 2024 | ADMINISTRATION
Oxfordshire-based aircraft firm Reaction Engines has crashed into administration with the loss of 173 jobs.
The administration of Reaction Engines, which has been working on a hybrid rocket engine that would enable hypersonic flying, will be managed by restructuring specialists from PwC. Sarah O’Toole, Peter Dickens and Edward Williams were appointed as Joint Administrators on Thursday October 31st.
There had been hopes that the Abingdon located company would be able to make a technological breakthrough akin to that of the iconic Concorde supersonic plane in the 1970s. Reaction’s Sabre technology, short for Synergetic Air Breathing Rocket Engine, is a hybrid jet and rocket engine, and was first developed in 1989. The aim was that it would allow passengers to enjoy hypersonic travel such as jetting from Britain to Australia in just four hours.
However, 173 of its 208 staff have now immediately been made redundant following the administration.
The company has received government funding, including from the Ministry of Defence, in addition to investments from BAE Systems and Rolls-Royce. It has been reported that the business had been negotiating for a £20 million financial lifeline with its shareholders, notably the Strategic Development Fund of the United Arab Emirates.
In a statement PwC said Reaction Engines had been “pursuing opportunities to raise further funds, but unfortunately, these attempts were unsuccessful”.
O’Toole added: “It’s with great sadness that a pioneering company with a 35-year history of spearheading aerospace innovation has unfortunately been unable to raise the funding required to continue operations.”
Last year, the business reportedly raised £40 million from investors, including those in the United Arab Emirates.
In its most recent accounts for the year ending 2022 it recorded revenues of £4.7 million down from £7.2 million the previous year. It posted an operating loss of £28.8 million, up from £20.2 million the previous year.
It said the operating loss had increased due to its programmes being funded by equity investment rather than grant revenue.
It had total assets of £39.6 million and total liabilities of £7.5 million.
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