Nordam Group Inc. and its domestic U.S. subsidiaries and affiliates yesterday filed for reorganization under U.S. Chapter 11 bankruptcy code. The move does not include or affect its foreign subsidiaries or affiliates, the company added.

According to Nordam, this action comes following a “protracted contract dispute with Pratt & Whitney Canada (P&WC) regarding the PW800 nacelle system used in [the] Gulfstream G500 and G600.” On July 5, Nordam announced that it suspended production of these nacelles “as a result of an impasse” with P&WC.

Nordam CEO Meredith Madden said the court filing was “not what we wanted to do, but it is what we had to do…it allows our business to operate without interruption.” In a statement, P&WC parent P&W said it has worked “diligently for many months with our supplier Nordam and its lenders to address the financial challenges Nordam is facing. P&W offered significant financial and other support that, in our view, could have kept Nordam out of bankruptcy.” P&W continued to offer this assistance despite Nordam’s “decision to breach its contract by suspending work on the PW800 nacelle program,” it said.

According to Nordam, it invested more than $200 million into the PW800 nacelle system, which is now FAA certified after having flown more than 6,400 flight-test hours.

P&W said it continues to remain “laser focused” on supporting Gulfstream’s engine delivery timelines “and will assess our next steps in the bankruptcy court with the goal of minimizing the impact on our customer’s aircraft programs.”