Tuesday outside of Portland bankruptcy court, a world-renowned planemaker appears to have purchased Bend-based Columbia Aircraft for what many say is a bargain price.
The deal is being finalized and if a bankruptcy judge accepts the terms, Kansas-based Cessna will have outbid just one other suitor for Columbia. Central Oregon correspondent Ethan Lindsey reports.
This is what Columbia's piston-driven plane sounds like.
[BRING UP COLUMBIA AMBI]
Its engine reminds me of a high-powered chainsaw.
[FADE DOWN COLUMBIA]
And, this is what a Cessna propeller jet sounds like.
[FADE UP CESSNA AMBI]
To me, that sounds more like a ceiling fan running on super-speed.
[FADE DOWN CESSNA]
Forgive the metaphor, but now we're gonna know what they sound like together.
After an auction that lasted just a few hours, it appears Cessna will purchase Columbia Aircraft for $26.4 million.
Columbia sells about 400 planes per year, for around half-a-million-dollars apiece.
But the company has suffered in recent years under the direction of an ownership group controlled by the Malaysian government.
Earlier this year, that ownership group threw in the towel, filed for bankruptcy protection, and put Columbia on the sales block.
A month ago, it looked as if four different aerospace companies would be bidding on the firm.
But in the end, only two companies participated.
After a routine bankruptcy hearing, Cessna's previously-submitted bid of $24.5 million opened the auction.
Then came a bid from Park Electrochemical. Park is a New York-based company that manufactures parts for small planes.
Cessna quickly responded with its counter offer that included more cash, and that was just too high a price, says Park vice president Jim Kelly.
Jim Kelly: “What we did wasn't controlled by what Cessna did. We had a value in our own minds about what we placed on the business and we were disciplined about it. And we decided not to exceed our own internal hurdle. It hit a point that we thought there wasn't enough value for us.”
One potential bidder that backed out altogether was Cirrus Design, perhaps Columbia Aircraft's biggest market competitor.
As part of the auction process, both Cirrus and Park got to check out how Columbia makes it planes and runs its business.
Some industry observers say the companies may never have been interested in buying Columbia at all -- and were only using the opportunity to spy on a rival.
Kelly says that's baloney.
Jim Kelly: “We were serious about it. We weren't doing it just to look under the skirt, so to speak. We feel the product is a good product. Pilots who fly the aircraft, love the aircraft. We feel it was a unique opportunity to create an exquisite company.”
Now it is Cessna with that opportunity.
The Wichita-based company reported revenues of $4 billion last year.
But Bend locals worry Columbia's 400 high-wage jobs will be moved to Kansas.
That could be financially devastating to a region already reeling from a real estate collapse.
However, Cessna has promised to keep the jobs in Oregon.
One piece of the company will be gone though. Under the terms of the deal, on December 4th, the Columbia Aircraft name will completely erased.
And the Cessna logo will be painted on the sign out front.