Keep up with the news chaps. Two investors and $600m cash injection.
easy there tiger, 2 hedge funds, who together hold 900Mn of the Hawker debt will do a debt swap for 81% equity, MS will set up another line of credit for 600Mn if the remaining 2.5Bn will be written of.
So not quite 2 investors, just 2 debt holders swapping for equity, the 600Mn will be used for debtor in possession financing, pay settlements and cure payments.
Not as rosy as you make it sound, the 2 Hf's (Bain and Centerbridge) are just trying to make a go of it instead of writing of their debt for now.
Of course the entire pension liability thus far accumulated will be written of and swapped for the remaining 19%
So the 2 Hf's will get a company with no pension liability and no debt and can use the 600Mn from the bank for themselves as in possession financing without putting a penny in. Why not give it go, better then writing of their 900 odd Mn now, at least they can milk it for a bit longer.
It is however still up to the courts to approve the emergence from Chapter 11, not a done deal yet.