May 3, 2012: Hawker Beechcraft files for Chapter 11 bankruptcy, meaning it intends to restructure and shed much or all of its debt.
Filing its plan in U.S. Bankruptcy Court in the Southern District of New York, the company said it needed to eliminate about $2.5 billion in debt and about $125 million of annual cash interest expense. The filing came five years after Goldman Sachs and Onex Corp. bought Raytheon Aircraft from Raytheon for $3.3 billion.
Officials said they would continue operations, as well as pay employees, suppliers, vendors and others in the normal course of business.
July 9: Company officials announce that they plan to sell Hawker Beechcraft to a Chinese company, Superior Aviation Beijing Co. The $1.79 billion deal would include everything but the company’s defense business. As part of the arrangement preceding the sale, Superior is to make payments to the Wichita planemaker over the next six weeks to help the company sustain its jet business until the close of the transaction, the company said. Superior also agreed to maintain Hawker Beechcraft’s U.S. headquarters, management team and employees, according to a statement from Hawker Beechcraft.
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July 17: Despite objections from the Machinists union, a federal bankruptcy judge approves Hawker Beechcraft’s motion to enter into exclusive negotiations with Superior Aviation Beijing regarding a sale of the planemaker’s assets. Approval from the court allows the financially troubled company and Superior to spend 45 days in due diligence and negotiations.
Hawker Beechcraft’s biggest union, the International Association of Machinists and Aerospace Workers, says it opposes the sale to a Chinese company, saying it would transfer valuable commercial and military-related technology to China, compromise national security interests and lead to the loss of skilled high-paying U.S. jobs.
Aug. 24: Machinists union members approve a new contract with the company. The new contract calls for an end of a retirement program of defined benefits and moves workers to a system of defined contributions.
Oct. 18: Company officials announce that the proposed sale to Superior Aviation has collapsed, and they will explore other options for the company’s jet business.
Dec. 5: The bankruptcy court approves the joint plan of reorganization filed by Hawker Beechcraft. The plan is for the company to emerge from bankruptcy as a smaller, stand-alone company called Beechcraft Corp. The company plans to end production of jets and focus on the King Air, Baron and Bonanza lines and defense and after-market business.
Feb. 1, 2013: Hawker Beechcraft gets the final approval needed from the bankruptcy court for its plan to restructure its company and shed company debt. Officials said they plan to emerge from bankruptcy in the second half of the month.