By: Jon Ostower
ORLANDO, Fla.—Hawker Beechcraft Inc. expects to make a decision on shedding its jet business by the end of the year as part of its Chapter 11 bankruptcy restructuring, the company’s chairman said.
Acquisition talks between Hawker and Superior Aviation Beijing Co. collapsed earlier this month, prompting Hawker to plan to emerge as a stand-alone company through its restructuring, which first began in May. As part of that process, the new company, to be dubbed Beechcraft Corp., will spin off or close its jet products line, which was particularly hard hit by the recession.
Hawker walked away from the Superior talks with a $50 million deposit that Superior had put down earlier as insurance in case the collapsed talks.
Hawker, based in Wichita, Kan., will have shed $2.5 billion in debt through the restructuring process when it exits bankruptcy in the first quarter of 2013, Hawker Chairman Bill Boisture said at a news conference at the National Business Aviation Association conference here.
Mr. Boisture declined to specify the exact number of bidders that Hawker is in talks with for its jet business, but said many of the original bidders prior to exclusive talks with Superior had returned. There were around six potential buyers before the Superior talks became exclusive.
As part of its reorganization, Hawker also will scale back the services it offers for some of its current aircraft, and the stand-alone company will launch two to three new aircraft as part of its new product strategy.
Shawn Vick, Hawker executive vice president, said a new concept propeller aircraft will include an engine provided by General Electric Co. GE 0.00% or United Technologies Corp. UTX 0.00% unit Pratt & Whitney Canada.