Hawker Beechcraft lifts tender offer for 8 7/8%/9 5/8% PIK, 9¾%, 8½% notes to $150 million

By Angela McDaniels

Tacoma, Wash., May 19 - Hawker Beechcraft Acquisition Co., LLC and Hawker Beechcraft Notes Co. said they increased the tender offer for a portion of their outstanding 8 7/8% - 9 5/8% in-kind - senior pay-in-kind notes due April 1, 2015, 9¾% senior subordinated notes due April 1, 2017 and 8½% senior fixed-rate notes due April 1, 2015.

The companies will now spend up to $150 million on the offer, excluding accrued interest, instead of $100 million.

In addition, the early tender premium deadline was extended from 5 p.m. ET on May 18 to midnight ET on June 2, which is when the tender offer expires.

For each $1,000 principal amount, the companies will pay $300 for the PIK notes, $340 for the 9¾% notes and $420 for the 8½% notes. The payment includes an early tender premium of $30 for each note.

The notes are listed in order of acceptance priority level. If the offer is oversubscribed, all notes with a higher priority level will be accepted before notes with a lower priority level are accepted.

The principal amount outstanding is $385,355,000 for the PIK notes, $220,599,000 for the 9¾% notes and $271,963,000 for the 8½% notes.

Following completion of the offer, the company plans to evaluate its future balance sheet management plans, which could include additional repurchases of notes as well as repayment under its revolving credit facility or prepayment of its term loan, according to a 10-Q filing with the Securities and Exchange Commission.

The company's management believes that cash on hand and cash from operations will be sufficient to meet requirements for the next 12 months after considering the impact of the planned tender offer.

Goldman, Sachs & Co. (800 828-3182 or collect 212 357-4692) is the dealer manager. MacKenzie Partners, Inc. (800 322-2885 or collect 212 929-5500) is the information agent.

Hawker Beechcraft is a Wichita, Kan., manufacturer of business jet, turboprop, piston-driven and military training aircraft.

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