Sometime in the second half of this month, Hawker Beechcraft will have a new name, a different CEO and a product line without business jets.
On Friday, the company received final approval of its reorganization plan from the U.S. Bankruptcy Court for the Southern District of New York.
It came close to final approval at a hearing on Thursday, but Judge Stuart Bernstein said he wanted minor changes in the wording of the draft of the company’s Joint Plan of Reorganization.
Now that Bernstein has given his final approval, next comes the emergence of the company from Chapter 11 bankruptcy, which it entered in May.
“Today’s ruling marks the final significant step in the restructuring process,” said Robert “Steve” Miller, CEO of Hawker Beechcraft Inc., in a news release from the company on Friday.
On the day that it emerges from bankruptcy, Miller will become a senior adviser to the board of the new company, to be named Beechcraft Corp. And Bill Boisture, chairman of Hawker Beechcraft Corp., will reassume the title of CEO of the new company. Boisture was CEO of the company until its board of directors brought in Miller, a restructuring specialist, about a year ago.
“Thanks to the hard work of our employees and the strong support we have received from our key creditors, union partners, elected officials, suppliers and customers, Beechcraft Corporation will emerge from this process as the world’s leading designer and manufacturer of turboprop, piston and trainer/attack aircraft with the largest global customer support network in the industry,” Boisture said in the release.
A company spokeswoman said Friday that neither Miller nor Boisture were available for additional comment.
Beechcraft Corp. will narrow its focus to manufacturing its propeller-driven airplanes: the Bonanza, Baron and King Air. Other key parts of its business will be military and after-market, which includes parts, maintenance, repairs and refurbishment.
Beechcraft Corp.’s board of directors will include Boisture, Donald G. Cook, Gene Davis, Ralph Heath, David Tolley, Gideon Argov and Robert Johnson. The company said it expects to name two more directors before it emerges from bankruptcy.
It also expects to retain its existing leadership team, which the company says will provide continuity and “valuable insight” going forward.
The company is currently owned by Onex Partners and GS Capital Partners, though that could change after it emerges as Beechcraft Corp. It has been widely reported that Beechcraft will be owned by a group of hedge funds. But the company has not confirmed that or the names of the owners.
The company has secured $600 million in exit financing in the form of a term loan and revolving credit from JPMorgan Chase Bank and Credit Suisse.
On Thursday the court approved a provision to cut costs by having the Pension Benefit Guarantee Corp. take over two Hawker Beechcraft retirement plans. The company also received court approval to continue a pension plan that was agreed to by the Machinists union that freezes pensions and creates a new retirement savings plan.
The company has more than 3,300 employees in Wichita and 5,400 companywide. Besides Wichita, the company operates more than 100 service centers worldwide and facilities in Little Rock, Ark., the United Kingdom and Mexico.
Contributing: Associated Press