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Beechcraft still a possibility for acquisition, officials say

  • The Wichita Eagle
  • Published Monday, July 15, 2013, at 9:32 p.m.

Officials from a Wichita consulting firm think Beechcraft Corp. could be acquired by another aviation company, possibly by the end of the year.

“We believe that Beechcraft remains a candidate for acquisition by another aerospace firm before year’s end, based on sources we’ve found to be extremely accurate in the past,” said Hunt Parker, a principal for Aero Business Group in Wichita.

“We do not claim to have a smoking gun or a Deep Throat contact that’s telling us this,” Parker said. “We have extensive contacts throughout the industry. It’s an assessment we are making based on two issues.”

“We are not seeing a significant amount of activity out there in terms of airplanes flying, production. It seems very quiet,” Parker said.

The Joint Primary Aircraft Training System program that supplies trainers to the Air Force and Navy is winding down, and trainer production will end in a couple of years. The company also needs money for product development for its product line.

“So that’s a real cash outflow,” he said.

The former Hawker Beechcraft emerged from Chapter 11 bankruptcy in February as the smaller, restructured Beechcraft Corp. focusing on its turboprop, piston, military and after-market business.

During the bankruptcy, the company eliminated business jet production, which was a drag on its financial performance. It plans to sell its business jet business.

Beechcraft spokeswoman Nicole Alexander declined to comment on Parker’s claim that the company could be sold, calling it speculation.

“We’ve been very public about the Hawker (jet) assets being for sale,” Alexander said. “But we’re not commenting on that speculation.”

Teal Group aerospace analyst Richard Aboulafia said he thought Beechcraft would be a likely candidate to be acquired – eventually.

“Smaller (aircraft) companies don’t stay independent for long,” Aboulafia said.

But he said that a sale by the end of this year “sounds very aggressive. ... It really helps to be owned by somebody with deeper pockets to help survive downturns.”

Now is not an ideal time for a sale, Aboulafia said.

“There’s too many variables,” he said. For one, global markets are weak.

The market remains difficult, Parker said. His firm’s forecast doesn’t see the market improving much next year or the year after that, he said.

“The sun will come up at some point,” he said. “It looks like it will take a couple of years to work our way through the downturn.”

Aero Business Group is a Wichita aviation consulting and sales representation firm founded in 2001.

Besides Parker, the principals of the firm include long-time aviation professionals Cecil Miller and Jim Moore.

Reach Molly McMillin at 316-269-6708 or mmcmillin@wichitaeagle.com. Follow her on Twitter: @mmcmillin.

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