Reaction Engines assures staff of timely salary payments amid cash struggles
- Reaction Engines has confirmed it will meet payroll obligations for October amid financial struggles.
- The company is in discussions to secure about £20 million in additional funding, but negotiations have faltered.
- Time is running out for securing investment to prevent administration, with serious implications for employees and operations.
Based in the United Kingdom, Reaction Engines has recently assured its employees that payroll will be processed as scheduled for October 2024, amidst substantial financial difficulties. The company has been actively seeking around £20 million in additional funding to sustain its operations. However, negotiations with the UAE’s Strategic Development Fund, which was expected to lead to a significant investment from the UAE's Tawazun Council, have encountered setbacks. For several weeks, Reaction Engines has been in discussions to reinforce its financial position. The complications around securing this funding have raised concerns about the company’s future, suggesting that it may soon face insolvency. It has come to light that PricewaterhouseCoopers is prepared to be appointed as administrators if a financial agreement isn’t reached swiftly. Additionally, Reaction Engines’ strategic shareholders, including BAE Systems and Rolls-Royce Holdings, have been consulted to possibly revise the terms of their engagement with the company. This is critical as the company possesses innovative cooling technology, intended for hypersonic flight, which has significant value in both commercial aviation and defense sectors. The implications of the current situation extend beyond financial stability, affecting aircraft development and potentially impacting jobs and economic stability in the area. With the clock ticking, Reaction Engines is exploring various investment alternatives to avoid a potentially devastating administrative process.