LH Aviation suspends Moroccan operations after ownership disagreement
French aircraft manufacturer LH Aviation says it has temporarily suspended the construction of its new factory plant in Morocco due to 'significant disagreements' with local business partner Mohsin Karim Bennani, who is also the president and principal shareholder of the new North Afican subsidiary, LH Aviation Maroc, writes Oscar Nkala.
The company also cited Bennani's 'months long absence' among the reasons for suspending operations. The Moroccan businessman partnered LH Aviation to form the local subsidiary in 2013. The partnership began setting up the new factory last year and it was expected to start producing the flagship LH-10 'Eclispe' light aircraft for sale into the African and Middle Eastern markets starting this year.
The company sees the Middle East and North Africa regions as potential growth markets following initial sales which were made to a West African military force and a company in the offshore energy industry in the United Arab Emirates (UAE) in 2010 and 2013 respectively. The LH-10 'Eclipse' will be the first aircraft to be fully assembled in Morocco if the project takes off again as widely expected.
The construction of the factory plant began in 2013 in the Moroccan town of Nouaceur and was expected to go into minimum production this year. However, the mother company said in a press statement that work
on the project has been suspended due to 'very significant disagreements between LH Aviation and the President of the Moroccan subsidiary, Mohsin M Karim Bennani, and (as a result) of his absence for several months.'
Despite the work stoppage, the company downplayed the possibility of project failure and instead highlighted its 'attachment' to the Moroccan project saying it hopes that the LH-10M Eclipse will still be the first aircraft to be manufactured entirely in Morocco. The factory was expected to progress from minimal production in 2015 and steadily
increase output to at least 80 LH-10M 'Eclispse' aircraft per annum in the next few years.
LH Aviation Maroc was set up in 2013 in terms of a capital investment deal which gave Bennani a 49 per cent stake while the French mother company - LH Aviation - retained a controlling 51 per cent stake in what could be North Africa's first fully indigenous aircraft manufacturer. Bennani initially invested $5.5 million to acquire the stake, which he had increased to $10 million when the project hit a snag mid-last month.
The company employed at least 10 highly qualified aeronautical engineers and support staff at the time of the work stoppage in Morocco. Since its highly successful debut at the Paris Air Show 2013, the LH-10M 'Eclipse' has been touted by the manufacturers as the first multi-role light aircraft which is fully adapted for all African environments by design. The low-cost aircraft can be configured for both military and civilian uses.
The carbon-fibre aircraft is powered by a single 100 horse-power petrol engine up to a maximum speed of 350km per hour and a maximum range of 760 nautical miles. It has an endurance of up to 6 hours and a record climb rate of 1 500 feet per minute. Its various operational roles include maritime surveillance, border surveillance, pilot training and emergency rescue. It has an armed reconnaissance variant which can be fitted with 68mm rockets and sensor turrets.
Presently, the LH-10M 'Eclipse' is operated by the Benin coastguard which bought three aircraft fitted with with digital cameras, a GPS and a satellite communication system for coastal surveillance duties.
In April 2013, the company supplied ten LH-1OMs to UAE-based Jet Energy in a contract worth 13 million euros. The aircraft are deployed in surveillance operations on off-shore infrastructure which includes oil rigs, ships and pipelines.