Hawker Beechcraft Files for Bankruptcy

Hawker Beechcraft, locked in the competition to win the Air Force’s Light Support Aircraft contract, filed for Chapter 11 bankruptcy. The company announced on May 3 that it had reached an agreement “with a significant number of its senior secured lenders and senior bondholders” on a financial restructuring plan that will eliminate about $2.5 billion in debt and another $125 million in annual cash interest expense. The restructuring plan will take effect once the court confirms it, said the company. “In the last three years, the company has made aggressive transformational changes in all operational functions, and today’s announcement represents the next step forward,” said company CEO Robert Miller. The restructure will allow the company to “compete in a rapidly changing environment,” he said. The news came on the eve of the Air Force issuing the final amended version of the LAS request for proposal under which the service wants to procure 20 light attack aircraft for the Afghan air force, with fielding starting in the third quarter of 2014. Hawker Beechcraft remains committed to its AT-6 bid for LAS and will be able to fulfill all orders, states the company’s release.