Textron buys Beechcraft in US$1.4 bil. deal
By Molly McMillin, The Wichita Eagle/MCT
December 28, 2013, 12:05 am TWN
The Wichita Eagle/MCT--Cessna Aircraft's parent company, Textron, is acquiring Wichita's Beechcraft Corp. for approximately US$1.4 billion in cash, the company confirmed Thursday evening.
“The acquisition of Beechcraft is a tremendous opportunity to extend our general aviation business,” Textron chairman and CEO Scott Donnelly said in a statement. “From our customers' perspective, this creates a broader selection of aircraft and a larger service footprint — all sharing the same high standards of quality and innovation.”
Beechcraft's King Air product line complements Cessna's Caravan and Citation line of jets, Donnelly said.
“This transaction represents an important step forward in the evolution of Beechcraft's business,” Beechcraft CEO Bill Boisture said in a statement. “The team has worked tirelessly to strengthen our core business and to maintain our position as a leader in a highly competitive environment.”
The sale is expected to close in the first half of next year.
Beechcraft hired Credit Suisse in October to sound out potential buyers, according to news reports earlier this month. And Textron's Donnelly has long expressed interest in the company.
Beechcraft is owned by four large shareholders and numerous smaller shareholders. Some of those shareholders were creditors who received equity in the company as part of the settlement of claims during Chapter 11 bankruptcy proceedings. Beechcraft exited bankruptcy in February.
The deal will be good for Wichita, aviation analyst Wayne Plucker of Frost & Sullivan, has said.
Beechcraft has good products, but it was too small of a player in a depressed market, Plucker said last week, after the Financial Times first reported the rumored sale. At the time, officials at both companies declined to comment on the report. And Cessna is only somewhat better, Plucker said, with sales of its light jets remaining weak.