Big defence company founded in South Africa files for bankruptcy

Defence company Paramount filed for bankruptcy in the US after suffering defeat in a long-running business dispute.

The United Arab Emirates-based company, founded by Ivor Ichikowitz in South Africa, filed for Chapter 11 Thursday in Delaware.

It listed assets of between $500 million and $1 billion and liabilities of between $100 million and $500 million in its bankruptcy petition.

In a statement following the Chapter 11 filing, Paramount said the bankruptcy is intended to address an arbitration penalty it received this month following a dispute dating to 2022 with an unnamed Middle Eastern company.

Paramount said the filing involves “a limited number of its non-operating entities,” won’t affect its global operations and will allow the company to pursue counterclaims.

Chapter 11 bankruptcy allows a company to keep operating while it works out a plan to repay creditors.

Formed at the end of apartheid in South Africa in 1994, Paramount became Africa’s largest privately owned defence and aerospace company.

It makes armored cars, maritime patrol and escort vessels and began producing the Mwari — the first military aircraft made in South Africa since the 1980s — in 2022.

Mwari, a reconnaissance and precision-strike aircraft, is marketed to emerging nations at a cost of about $10 million, excluding add-ons.

The Paramount unit that makes the Mwari aircraft isn’t part of the Chapter 11, a company spokesperson said.

The company is headquartered in Abu Dhabi, according to its website and bankruptcy petition. The company also listed corporate affiliates in Cyprus and Delaware.

Eric Ichikowitz, a brother of Ivor and group marketing director of Paramount, said he wasn’t authorized to comment when called by Bloomberg. A lawyer representing Paramount didn’t immediately return a message seeking comment.

The case is Paramount Group Ltd., 24-11849, in the US Bankruptcy Court for the District of Delaware.