Two years after US aerospace manufacturer Pratt & Whitney announced the closure of the Israeli factory Blades Technology (BTL), the situation on the ground has changed. It was expected that 900 employees would be laid off at the Nahariya factory. But a source close to the matter told Globes that the BTL compressor blade factory will not close in 2025, following a decision by Pratt & Whitney.
BTL manufactures aircraft parts and equipment. In a letter sent two years ago by then CEO Igor Krabovinsky, who as far as we know is no longer in office, he wrote: “Unfortunately, for a long time now, the plant has been accumulating significant losses that are increasing. Production processes that exist today at Blades Technology do not allow us to maintain Productivity in an economically viable way, due to reduced demand on compressor blades.
Employees were then informed that Pratt & Whitney had decided to end BTL’s compressor blade manufacturing operations in a process that would be completed in 2025, with most employees losing their jobs in 2024 and 2025. But due to internal considerations on the part of Pratt & Whitney, the company was closed and the plant has now been postponed for at least a year, although it has been said in the past that the technology used in Nahariya is outdated and no longer of any use.
“Given our efforts to protect workers, as well as the agreement we signed with management last year, BTL will continue to operate in 2025,” said the Histadrut General Union, which represents BTL employees.
The factory in Nahariya, originally called Iskar Blades, was founded by Israeli businessman Steve Wertheimer more than 50 years ago, following France’s blockade of Israel after the 1967 Six-Day War, which left Israel’s Mirage fighter jets without compressor blades. . In the 1990s, the plant began exporting to clients including Rolls-Royce, General Electric and Pratt & Whitney, which acquired BTL in 2014 from the Wertheimer family for an undisclosed sum. That was one year after the family completed the two-stage sale of business tools company Iscar to Warren Buffett for $6 billion.
But in 2022, Pratt & Whitney’s decision to close the Israeli factory came after years in which there was no investment in updating the technology used by BTL. It remains unclear what led to Pratt & Whitney’s decision to postpone the plant’s closure although there has been no apparent change in its position on the fact that BTL’s operations are not economically viable.
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Six months ago, the land on which the factory was built was sold by Menivim REIT (TASE: MNRT), which bought it from the Wertheimer family in 2020, to Marathon REIT for NIS 155 million (compared to a book value of NIS 143 million).
Minifem explained this move as “due to BTL announcing the cessation of operations at the site.” Marathon Fund, which specializes in real estate improvement and rezoning, is expected to apply to rezone the Nahariya plot of land from industrial use to residential, office, hotel and commercial use.
The deal is scheduled to close four years from the signing date, with an option to extend until BTL’s lease expires in June 2029. The plot extends over 55 dunams (11.25 acres) and includes six buildings totaling 22,000 square metres.
Published by Globes, Israel Business News – en.globes.co.il – on January 2, 2025
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