Hawker Beechcraft creditors approve plan; February emergence expected

By Caroline Salls

Pittsburgh, Jan. 25 - Hawker Beechcraft, Inc. said the key creditors voting in its solicitation process overwhelmingly approved the company's proposed joint plan of reorganization, according to a company news release.

In addition, Hawker Beechcraft announced that J.P. Morgan Securities LLC and Credit Suisse Securities (USA) LLC agreed to act as joint lead arrangers and joint bookrunners to structure, arrange and syndicate $600 million in exit financing, consisting of a term loan and a revolving line of credit.

The affiliated banks of the joint lead arrangers, JPMorgan Chase Bank, NA and Credit Suisse AG, committed to underwrite the financing, which will be used to repay all claims under the debtor-in-possession credit facility, pay specified settlement and cure payments and fund ongoing operations.

The financing is subject to completion of definitive financing documentation and bankruptcy court approval.

"The tremendous show of support of our creditors for the plan, which will dramatically reduce Hawker Beechcraft's debt load, and the financing commitment from JPMorgan and Credit Suisse mark an important milestone for the company as it moves closer to emerging from the restructuring process," Hawker Beechcraft chief executive officer Robert S. "Steve" Miller said in the release.

The company's plan confirmation hearing is scheduled for Jan. 31. Hawker Beechcraft said it expects to emerge from bankruptcy in the second half of February.

"The reorganized Beechcraft Corp. will emerge from this process in a strong operational and financial position, with the working capital and flexibility to execute a strategy built around our core products like the world-renowned King Air twin engine turboprop and the T-6 military training aircraft, which will enable the company to compete well into the future," chairman Bill Boisture said in the release.

Upon emergence, pre-bankruptcy secured bank debt, unsecured bond debt and some general unsecured claims will be canceled and holders will receive equity in the reorganized company.

A new board of directors, to be appointed by the new owners of the company, will take over on the date of emergence, according to the release.

Hawker Beechcraft is a Wichita, Kan.-based manufacturer of business, special mission, light attack and trainer aircraft. The company filed for bankruptcy on May 3, 2012 in the U.S. Bankruptcy Court for the Southern District of New York under Chapter 11 case number 12-11873.

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