Hawker Beechcraft hopes to close China deal soon
Hawker Beechcraft may soon close a deal with a Chinese industrialist backed by Beijing to sell the venerable—and bankrupt—general aviation giant, excluding its defense business. Hawker Beechcraft Chairman Bill Boisture told Flight International on Sept. 5 that the deal is “going to happen in the next few days.” The court has approved an exclusive negotiations agreement reached in July that had a $1.79 billion purchase price attached, with 45 days to close the deal. The U.S. Bankruptcy Court for the Southern District of New York must also approve the sale of Hawker Beechcraft to Superior Aviation Beijing, and rival bidders will have a chance to come forward. Several companies have expressed at least passing interest in buying some or all of Hawker Beechcraft’s assets.
The bankruptcy process has been expensive: Attorneys recently billed $1.7 million for a month’s work (July), according to court records. Accountants submitted a more modest invoice for $297,870 for tax services between May 3, when the company filed for bankruptcy, and July 31.
The company has continued operations with an influx of cash from Superior: $50 million was to be paid during negotiations of the purchase agreement. Hawker Beechcraft has also sought court approval to sell vacant land to Wichita, which the city government would use to widen a local road, for $2.9 million. The company argued in court filings that the price is fair, and the city could take the land under eminent domain, anyway.
The court on Sept. 4 granted a 120-day extension that will allow Hawker Beechcraft to submit its formal bankruptcy plan in early 2013. The company had previously stated a hope that the process would conclude by the end of the year.
The legal gyrations did not seem to disturb Bonanza owners interviewed by Corporate Jet Investor as they gathered in Wales, in the United Kingdom. Bonanza G35 owner Adrian Daley was among the unfazed: "From my perspective, I do not have any concerns with the Beechcraft factory,” Daley told Corporate Jet Investor. "I have never had any need for factory support, I have no need to buy parts—this thing is built like a proverbial outhouse."
September 12, 2012