Beechcraft Emerges From Bankruptcy
The former Hawker Beechcraft has shed much of its debt along with half of its name. Future focus on military contracts could be jeopardized by sequestration, loss of Afghan Air Force contract.
The AP (2/20, Hegeman) reports, “Aircraft maker Beechcraft, formerly Hawker Beechcraft, emerged Tuesday from bankruptcy protection freed from much of its debt and its unprofitable business jet operations. It's now focused on its turboprop and piston aircraft, and on its military work”
The Wichita (KS) Eagle (2/19) reported that “Bill Boisture, who has returned to his role as the airplane maker’s top executive, said that the reorganized company is ready to focus on growing again….The emergence from bankruptcy continues the legacy of the company founded in 1932 by Walter and Olive Ann Beech, which has manufactured more than 54,000 airplanes, 36,000 of which it said are still flying.” The article reports that about 90 percent of Beechcraft’s owners are financial institutions that were its secured creditors during the bankruptcy. The largest creditors among them are Angelo, Gordon & Co., Capital Research & Management, Centerbridge Partners LP and Sankaty Advisors, a division of Bain Capital, according to the article.
Aviation Week (2/20) reports, “Beechcraft emerges as a smaller company, with employee numbers in Kansas dipping below the 4,000 level that the company guaranteed in order to receive full state and local incentives. Its total employment is around 5400. The company has a smaller product portfolio, focused on military trainer/special mission aircraft, pistons and turboprops.”
Flightglobal (2/20) and other media sources also cover the story.
In a press release from the company listed on PRNewswire “The company's Global Customer Support (GCS) team and its factory-owned service center network, Hawker Beechcraft Services, will continue supporting all Hawker and Beechcraft products. The network includes 10 facilities in the United States, Mexico and the United Kingdom, along with more than 90 authorized service centers around the world.”
In related news, and a blow to Beechcraft, it was reported that a team composed of Sierra Nevada and Embraer won $427 Million Air Force Contract. Bloomberg News (2/28, Ivory, Capaccio) reports, “Sierra Nevada Corp. and Embraer SA, its Brazilian subcontractor, have won a $427 million US military contract to provide aircraft for the Afghan army after more than a year of delays and protests. The Air Force award is for 20 light-attack planes, maintenance support and training, the Defense Department said today in a statement. The contract is valued at a maximum of $950 million over its lifetime.” Beechcraft had proposed its AT-6. A plane based on the Embraer A-29 Super Tucano light attack aircraft was chosen instead. Other sources covering the story include AP (2/28, Hegeman), Wichita Business Journal (2/27, McCoy), and Reuters (2/2).