Hawker Beechcraft, jet manufacturer, takes steps towards bankruptcy

Wichita, KS- Jet manufacturer Hawker Beechcraft is in talks with lenders to make preparations for a pre-arranged bankruptcy filing, Reuters reported Wednesday.

Hawker, based in Kansas, said it has secured $120 million in loans to continue operations while it restructures debts under Chapter 11 bankruptcy. Creditors have agreed to give Hawker forbearance on interest payments and agreed to grant relief from loan obligations.

Bankruptcy attorneys will recommend a Chapter 11 filing for companies that need to reorganize their debts so they can continue operating their business.

Hawker developed after Onex, a Canadian private equity firm and Goldman Sachs in 2007 acquired Raytheon in 2007, hoping to capitalize on the enthusiasm for private jets.

The financial crisis eliminated discretionary spending for individuals and businesses and Hawker suffered, losing billions of dollars as demand for their aircraft declined. They were forced to lay off 2,500 employees.

Last year, Hawker hired Robert S. Miller, who is a restructuring specialist, as their chief executive. Miller said Tuesday that the company has attempted to improve its operations, but their debt load is inhibiting their turnaround effort.

This is the fate of many companies in tough financial times. An experienced bankruptcy attorney can suggest the right bankruptcy structure and help the distressed business turn their finances around. After careful evaluation and consideration, a bankruptcy lawyer will work on negotiating with creditors in order to reduce the troubled company’s debt liabilities and return them to profitability.