TEL AVIV — Failure to secure international buyers for its unmanned ground systems (UGS) is forcing G-Nius — a joint venture by state-owned Israel Aerospace Industries (IAI) and Elbit Systems — to disband operations.

Launched to much fanfare nearly a decade ago and fueled by more than 250 million shekels ($US 66 million) in research and development funding by the Israeli Ministry of Defense (MoD), G-Nius is folding up shop after having produced several operational prototypes for use by the Israeli military.

The unannounced closure of the 30-employee company was first reported by Globes, an Israeli financial daily, and confirmed Monday by Elbit.

"Elbit Systems and Israel Aerospace Industries decided to wind up their joint venture, G-Nius, which has engaged in the field of autonomous ground vehicles. The decision was reached jointly by the two companies and in coordination with the Israeli Ministry of Defense," according to a statement from Elbit.

According to Elbit, IAI employees assigned to the joint venture are returning "in these days" to their parent company while Elbit will continue to engage former G-Nius personnel on UGS-related projects at company facilities in Yokneam, Israel.

Moreover, Elbit will continue to support a pilot program whereby the Israeli military operates G-Nius-developed vehicles at Israel's northern and southern borders.

"We've had a tremendous amount of interest in successive generations of unmanned ground systems developed by G-Nius but no business to speak of," an Elbit executive told Defense News.

In a statement to Globes, Israel's MoD said that according to the joint venture agreement, Elbit and IAI will be able to use knowledge derived from the G-Nius joint venture to further future "separate and independent activities in the field of robotics."

MoD also noted that the two firms "agreed to evaluate continued cooperation in the international market."

Under a pilot program supported by Israel's MoD since 2008, the Israeli military has operated multiple prototype versions of G-Nius-developed UGS vehicles, including the first-generation Guardium and the heavier, follow-on Nahshon.

Under a 2009 MoD development contract, the heavy, 2-ton-hauling, tracked Nahshon was intended to usher in a new class of fully autonomous unmanned combat ground systems.

Elbit and IAI have described G-Nius as a leading developer and supplier of "a variety of autonomous unmanned ground systems solutions, which are based on a common, versatile and layered avionics suite; applying emerging technological breakthroughs in navigation, control theorem, artificial intelligence and 3D artificial imaging."

It aspired to become a lead player in the global military, homeland security and law enforcement markets — forecasts that one Israeli executive on Monday conceded were "excessively premature."