Israeli Defense Supplier Faces Bankruptcy With $7 Million Debt
Translated & summarized from Calcalist by baba
Israeli defense components supplier C.M. Composite Materials has filed for bankruptcy protection with debts of approximately NIS 26 million ($7 million). The company, which supplies major clients like Boeing and Rafael, cited the COVID-19 pandemic, global recession, and costly relocation as reasons for its financial distress. Despite its difficulties, the company expressed optimism about its rehabilitation prospects.
The story in 6 lines · by baba
- Defense supplier C.M. Composite Materials faces bankruptcy with NIS 26 million in debts.
- The company supplies major clients including Boeing, Rafael, and Elbit.
- Factors contributing to financial distress include the COVID-19 pandemic and global recession.
- The company's assets are valued at over NIS 10 million, with debts totaling NIS 26 million.
- An additional debt of approximately $8 million is owed to an American investor.
- The company is seeking court protection for rehabilitation and appointment of a trustee.
C.M. Composite Materials, an Israeli supplier of components to the defense industry, has filed for urgent court protection from creditors, citing debts of approximately NIS 26 million (about $7 million). The company, based in Modi'in and employing around 105 workers, is seeking a rehabilitation order and the appointment of a temporary trustee.
Founded in 2007 and managed by controlling shareholder Matanya Muscovitz, the company specializes in producing composite materials for the defense and aerospace sectors. It is recognized by the state as an essential factory with vital services and holds approved supplier status for stringent security and aviation standards. Its prominent clients include Israel Aerospace Industries, Rafael, Elbit, and Boeing.
The company manufactures structural components, assemblies, production molds, and fuselage parts for unmanned aerial vehicles (UAVs). The filing highlights the company's nearly 20 years of operation, its extensive professional knowledge, and valuable production authorizations for key Israeli defense manufacturers and international clients.
According to the petition, the company's assets are valued at over NIS 10 million, while its debts total around NIS 26 million. This figure excludes an additional debt of approximately $8 million to an American company that provided funding and is described as an investor showing significant trust. Debts include NIS 4 million to employees, NIS 2.5 million to tax authorities, NIS 5.35 million to the National Insurance Institute and pension funds, NIS 7.15 million to Gizah Singer Even Maznin, and NIS 6.5 million to general creditors.
C.M. Composite Materials attributes its financial difficulties to several factors, including the COVID-19 pandemic and global recession, which led to reduced orders and supply chain disruptions. The company also cites increased expenses from expanding its management and administrative staff under a former CEO, a costly relocation to a new facility in Modi'in in 2023, and significant shipping and additional expenses.
In response, the company expressed optimism about its rehabilitation prospects, citing the significant value of its operations and anticipating productive cooperation with the appointed trustee.
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