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 August 31, 2015

News: Pilot killed in crash was helping wounded veterans – A pilot who died in a small plane crash in the desert northeast of Los Angeles was giving free glider rides to wounded military veterans. Turkey carries out first air strikes as part of anti-Isis U.S. coalition – Turkish fighter jets have carried out their first air...
 
 

News Briefs August 31, 2015

Pakistan officials: U.S. envoy discusses Afghan peace efforts Pakistani officials say visiting U.S. National Security Adviser Susan Rice has discussed efforts to revive Afghan peace talks. Rice met with Prime Minister Nawaz Sharif and army chief Gen. Raheel Sharif Aug. 30. Two Pakistani officials say they discussed efforts to revive talks between the Afghan government...
 
 
Courtesy photograph

F-22 inaugural deployment to Europe

Courtesy photograph A pair of F-22 Raptors fly near the coastline of Panama City Beach, Fla. Four F-22 Raptors, one C-17 Globemaster III, and approximately 60 airmen arrived at Spangdahlem Air Base, Germany, to train with allie...
 

 
ILS photograph

Boeing-built satellite will create first global high-speed broadband network

ILS photograph The Inmarsat-5 F3 satellite launched Aug. 28 aboard a International Launch Services Proton Breeze M rocket from Baikonur, Kazakhstan. EL SEGUNDO, Calif.–When the third Boeing-built [NYSE: BA] Inmarsat-5 sat...
 
 

Civil Air Patrol joins total force ‘Airmen’

When conducting missions for the Air Force as the official Air Force auxiliary, the Civil Air Patrol is now included in the Air Force’s definition of the total force. CAP has provided 74 years of support to emergency services, aerospace education and cadet programs. In August 2015, the Air Force updated Doctrine Volume 2, “Leadership,”...
 
 
DOD photograph by Air Force MSgt. Adrian Cadiz

Carter announces manufacturing initiative to aid war fighters

DOD photograph by Air Force MSgt. Adrian Cadiz Defense Secretary Ash Carter announces the creation of a National Manufacturing Innovation Institute to produce hybrid electronics during a speech at the National Full Scale Aerody...
 




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=""> <s> <strike> <strong>