Business

January 30, 2013

Hawker Beechcraft closer to bankruptcy emergence

Roxana Hegeman
Associated Press

Kansas plane maker Hawker Beechcraft said Jan. 25 that its key creditors overwhelmingly backed a proposed reorganization plan in a vote that moves the company closer to emerging from bankruptcy protection as early as next month.

The Wichita, Kansas,-based company said that it will seek court approval to exit bankruptcy at a hearing Thursday and expects to emerge from Chapter 11 in the second half of February, if the bankruptcy judge approves the plan.

It also has secured an underwriting commitment for $600 million in exit financing consisting of a term loan and revolving line of credit from JPMorgan Chase Bank and Credit Suisse.

“The tremendous show of support of our creditors for the Plan, which will dramatically reduce Hawker Beechcraft’s debt load, and the financing commitment from JPMorgan and Credit Suisse mark an important milestone for the company as it moves closer to emerging from the restructuring process,” CEO Robert “Steve” Miller said in a news release.

The slimmed down company – which plans to rename itself Beechcraft Corp. – will focus on more profitable turboprop, piston, special mission and military aircraft, as well as its parts, maintenance, repairs and refurbishment business. The reorganized company plans to shed its struggling business jet operations.

Under the reorganization plan, secured bank debt incurred before the bankruptcy as well as unsecured bond debt and certain general unsecured claims will be cancelled with those creditors receiving equity in the reorganized company. A board appointed by the new owners will take over once the company emerges from bankruptcy protection.

“The reorganized Beechcraft Corporation will emerge from this process in a strong operational and financial position, with the working capital and flexibility to execute a strategy built around our core products like the world-renowned King Air twin engine turboprop and the T-6 military training aircraft, which will enable the company to compete well into the future,” said Bill Boisture, chairman of Hawker Beechcraft Corp.

It is unclear yet how many employees the reorganized company will keep as it stops making business jets.

“Job numbers depend on completing the reorganization – and military contracts that could significantly affect numbers one way or the other,” said Frank Larkin, spokesman for the machinists union, which represents Hawker Beechcraft workers.

The bankruptcy court is also expected to rule Thursday on the fate of company’s three pension programs. Hawker Beechcraft has asked the court to allow it to continue the pension plan for hourly workers under an agreement reached with the machinists union that freezes pensions and creates a new retirement savings plan.

“That was a major goal for our negotiations and if that is approved it will be a significant accomplishment,” Larkin said.

Hawker Beechcraft, owned by Onex Partners and GS Capital Partners, filed for bankruptcy protection in May. It has struggled with the sluggish business jet market more than other plane makers. It was purchased in 2007 in a highly leveraged deal just before the general aviation market tanked.

The complex bankruptcy proceedings have involved 18 entities, 5,400 employees worldwide and $2.4 billion in debt. In addition to its Wichita headquarters, the company has factories in Little Rock, Ark., the United Kingdom and Mexico, as well as more than 100 service centers worldwide.

Hawker Beechcraft traces its Kansas roots to Beech Aircraft Corp., a company founded by Walter and Olive Ann Beech that began making aircraft in the 1930s.




All of this week's top headlines to your email every Friday.


 
 

 

Headlines July 25, 2014

News: VA reform bills stalled by partisan bickering - Plans for a comprehensive Veterans Affairs Department reform bill that appeared all but finished a month ago devolved into partisan bickering and funding fights July 24, casting doubt on the future of a deal.   Business: Airbus, Boeing, Lockheed announce bids on Danish fighter competition; Saab withdraws -...
 
 

News Briefs July 25, 2014

Marines investigate corporal who vanished in Iraq U.S. Marine Corp officers are launching a formal investigation into whether a Lebanese-American Marine deserted his unit in Iraq or later after returning to the United States. A spokesman for the 2nd Marine Expeditionary Force at Camp Lejeune said July 24 that Cpl. Wassef Ali Hassoun is being...
 
 
Air Force photograph by A1C Erin OíShea

U.S. Forces display military might at Farnborough

Air Force photograph by A1C Erin O’Shea Capt. Tom Meyers discusses the F-15E Strike Eagle’s capabilities with spectators July 17, 2014, at the Farnborough International Airshow in England. Public access was granted ...
 

 
raptors4

Raptors, Falcons fuel up in desert skies

Three U.S. Air Force F-22 Raptors assigned to the 325th Fighter Wing, Tyndall Air Force Base, Fla., fly alongside a KC-135 Stratotanker assigned to the 93rd Air Refueling Squadron, Fairchild AFB, Wash., during Red Flag 14-3, Ju...
 
 
lm-kmax

Lockheed Martin’s unmanned cargo helicopter team returns from deployment

After lifting more than 4.5 million pounds of cargo and conducting thousands of delivery missions for the U.S. Marine Corps, the Lockheed Martin and Kaman Aerospace Corporation K-MAX cargo unmanned aircraft system has returned ...
 
 
Air Force photograph by A1C Thomas Spangler

Sun sets on Red Flag 14-3

Air Force photograph by A1C Thomas Spangler The sun sets behind a row of F-16 Fighting Falcons during Red Flag 14-3, July 16, 2014, at Nellis Air Force Base, Nev. Red Flag provides a series of intense air-to-air combat scenario...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>