LONDON – Light helicopter maker MD Helicopters successfully emerged from Chapter 11 bankruptcy after going into voluntary bankruptcy in March 2022.
The manufacturer’s new CEO, Brad Pederson, has high hopes for the “new” MD Helicopters as the company hopes to increase production of its iconic 500-series single-engine helicopter from the current inventory of 15 to 20 helicopters in expecting delivery in 2023.
MD Helicopters LLC
MD Helicopters successfully exited Chapter 11 Bankruptcy and its assets were taken over by a new operating company – MD Helicopters LLC. As part of this company’s efforts to restructure its organization, MD Helicopters LLC selects a new board of directors, CEO and a handful of senior executives to assume their respective new roles.
MD Helicopters LLC is now 62% majority owned by MBIA, its main bond issuer. MBIA will take up three seats on MD’s new seven-member board team, making it something of a big player in the business.
The company’s former interests are held by Patriarch Partners and Lynn Tilton in the former MD have been terminated. Ed Dolanski, who previously served as president of the $10 billion U.S. government services business for Boeing Global Services, will serve as chairman of the board.
Appointment of CEO
As part of the leadership team, Brad Pederson, a veteran aerospace executive, has been named CEO. Prior to joining MD Helicopters LLC, Pederson was CEO of Breeze-Eastern, a conglomerate that produces hoists and related equipment for civil and military aircraft, as well as President of Airborne Systems Group.
In addition, Pederson has also held senior rotorcraft management positions at Sikorsky and Boeing.
In addition to these impressive high-level positions, MD Helicopters has also recruited high-level executives to fill the positions of CFO, VP Aftermarket Sales and VP New Aircraft Manufacturing.
Despite the company’s abrupt change in ownership, the helicopters will remain in production in Mesa, Arizona, where it employs 250 people.
The new president says MD Helicopters LLC will aim to rebuild its already proven product and create a robust after-sales service regime for all its new deployed and existing models.
Over the next two to five years, the helicopter manufacturer will gradually increase the manufacturing capacities of its iconic 500 series of single-engine helicopters from the current assembly line to 15 to 20 by 2023.
Pederson stressed that the company will also invest heavily in spare parts and its product support will be on par with other global manufacturers.
The newly proclaimed CEO says the company will grow as it adapts to lean methods of governance and will not forget what happened in the past when it comes to mismanagement. He later said that: “Most of our wounds were self-inflicted”,
Bankruptcy in March
MD Helicopters voluntarily filed for bankruptcy to settle its debt, with efforts to infuse the company with $60 million of new “debtor-in-possession” capital.
This explosion in the underlying cost of debt has been attributed to mismanagement, but has also been accelerated by the COVID-19 pandemic. MD Helicopter’s day-to-day operations remained normal throughout the bankruptcy process.