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Monday, March 3, 2008

Acquisition of Hawker Beechcraft’s Line Service Operations

BBA Aviation announced that it has agreed to acquire the assets of Hawker Beechcraft Services Inc.’s line service operations for a cash consideration of $128.5 million on a debt and cash-free basis. The acquisition consists of seven geographically diverse fixed base operations (FBO). Hawker Beechcraft will retain its factory-owned Hawker Beechcraft Services maintenance and customer support facilities co-located at these locations. Hawker Beechcraft’s operations in Little Rock, Arkansas, Chester, England, U.K., and Toluca, Mexico will not be affected. In 2007 Hawker Beechcraft’s Line Service Operations had sales of $73 million, EBITDA margins of 12 percent and gross assets of approximately $16 million. It is expected that the acquisition will be immediately earnings enhancing and returns should be in excess of BBA Aviation’s cost of capital by 2010. Hawker Beechcraft is divesting its line service operations in order to focus on its maintenance repair and overhaul business. Closing of the deal is expected in May 2008.
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