On Thursday, May 3, Hawker Beechcraft announced it was filing bankruptcy to eliminate $2.5 billion in debt. The aircraft manufacturer that is based in Wichita, Kansas, filed for Chapter 11 bankruptcy on Thursday at the U.S. Bankruptcy Court in New York as part of a restructuring deal to transfer ownership of the company to the creditors. For doing so, Hawker Beechcraft received a $400 million commitment from the creditors to keep operations going.
Hawker Beechcraft CEO Robert Miller said in a statement, “We are pleased to have reached an agreement with our largest lenders and bondholders on a solution to stabilize through our capital structure.”
With Hawker Beechcraft filing bankruptcy, this is another hit to the aerospace industry in Wichita, Kansas. In January 2012, Boeing announced it would be shifting its plan there.
Hawker Beechcraft makes commercial planes and also is a military contractor. Recently, the aircraft company has been fighting for a light air support Air Force contract in the amount of $355 million with Sierra Nevada Corporation and Embraer, a Brazilian aerospace firm. Last year, the contract was awarded to the other two firms prior to the Air Force canceling the contract and restarting the competition.
With the US economy sliding down that slippery slope, many corporations will be looking for the relief of a bankruptcy filing. Hopefully, Hawker Beechcraft comes out on top as the Wichita area can’t handle another loss of employment to the aerospace industry.