Mar 07, 2013. /Lesprom Network/. The companies of discontinued Viscose segment of Neo Industrial Plc, Avilon Fibres Ltd and Carbatec Ltd, have filed for bankcruptcy at the District Court of Pirkanmaa, Finland, as the company said in a press release received by Lesprom Network. Avilon Fibres Ltd (previously Avilon Ltd) applied for corporate restructuring on 7 September 2011 and was accepted for restructuring program on 28 June 2012. The restructuring's objective was to secure company's long-term development by ensuring short-term operating conditions. After bankcruptcy the restructuring program expires and the cut debts of Avilon Fibres Ltd will revert to former state accordingly. The most significant factor for the current situation has been the extremely low market price level of viscose fiber during the last two years, and this trend is still continuing, the company said. The most crucial factor that reduced the competitiveness of Avilon Fibres Ltd has been the cost of energy which is remarkably lower in the operational environments of its competitors. The production of viscose is typically energy-intensive process industry where the Finnish cost of labour is not a critical factor. Avilon Fibres Oy has aimed at specializing in niche products with high degree processing. The fire-retardant fiber products developed by Avilon Fibres Ltd and Carbatec Ltd have not been selling according to expectations due to the weak level of construction business during the last two years in the United States, the main market of this product. Launching of the antimicrobial fibers has been delayed. First test batches have been delivered and positively tested by the customers but the actual volume sales is still on negotiation level. First steps taken for the commercialization of PPV (Paper Pulp to Viscose) technology, enabling the usage of paper pulp in the viscose manufacture process, could not bring enough cash flow to ensure the operation of Avilon Fibres Ltd and Carbatec Ltd. The above mentioned factors together with the financing situation have led Avilon Fibres Ltd to the situation where the continuity of present operation mode is not possible. In this connection it was decided that also Carbatec Ltd, the parent company of Avilon Fibres Ltd, will also file for bankcruptcy. Carbatec Ltd owns PPV and other technologies connected with viscose manufacturing. The bankruptcy of Avilon Fibres Ltd and Carbatec Ltd is considered not to have any immediate effects on the cash flow of Neo Industrial Plc or Neo Industrial Group. The effects of the bankcruptcy on Financial Statements for 2012 of Neo Industrial Plc and Neo Industrial Group will be cleared as soon as possible.