Bidding Was Brief; Total Price $26.9 Million

ANN REALTIME UPDATE 11.27.07 1725 EST: So... will it now be Colessna? Cessnumbia? Rich Belzer, former vice-president of sales for Columbia Aircraft, sent this update to ANN regarding today's auction for Bend, OR-based planemaker Columbia Aircraft Manufacturing, while on the run to catch his flight back home:

After a lengthy hearing regarding whether Park Electrochemical's initial overbid should (excepting the cash amount) be considered qualitatively equivalent to Cessna's (it was), bidding finally began at 11:00 am (PST) and it was all over by 11:15. After countering Park Electrochemical's initial overbid of $15 million with a $15.2 million bid, Cessna only needed two more bids to top Park with a cash bid of $16.4 million, just $2.4 million above their original offer.

Including the $2 million to Garmin and assumption of liabilities (future warranty claims and deicing installations), the total Cessna offer (pending an inventory) amounts to $26.9 million.

Closing will take place on December 4, and at that point, Cessna will take possession of the former Columbia Aircraft facilities in Bend, Oregon. The Ad Hoc Owner's Committee of Columbia Aircraft owners attended in force and was highly enthusiastic with the outcome. Cessna has already announced their intent to continue building the Columbia 350 and 400 in Bend and is expected to provide warranty and service support for all Columbia Aircraft customers.

ANN will provide further updates as they become available.

Earlier Reports

1645 EST: And then there was one. Park Electrochemical Corp. has just announced it has discontinued its participation in the bidding for certain assets and business of Columbia Aircraft Manufacturing Corporation ("Columbia") in today's auction conducted in the United States Bankruptcy Court for the District of Oregon in Portland OR.

Park had submitted an initial bid for portions of Columbia on November 20, 2007, after conducting due diligence. Park participated in Tuesday's auction, but chose to discontinue its participation in the auction bidding process.

"We would like to thank the employees of Columbia Aircraft Manufacturing for all of their help and assistance relating to our due diligence efforts," said Brian Shore, Park’s President and CEO. "We wish the employees the best of luck in the future. In our opinion, the business will be in good hands with its new owner. I would also like to take this opportunity to thank Lance Neibauer, the very talented designer of the Columbia aircraft models, for his help in connection with our due diligence efforts."

Park's withdrawal effectively leaves just one bidder for Columbia... Cessna Aircraft Company.

1300 EST: Will it be Cessna? All indicators point to... probably, at least if the Columbia Aircraft Owners Ad Hoc Committee has its say during today's auction for the assets of Columbia Aircraft Manufacturing.

On Monday, the owners filed a motion before the US Bankruptcy Court, stating the deal posed from Cessna Aircraft Company represents the "best offer" for the planemaker, in the auction now underway in Bend, OR.

The committee -- comprised of five Columbia aircraft owners who presently serve on the Board of Directors of the Columbia Aircraft Pilots Association, also known as "Club Columbia" -- represents the interests of all current owners of Columbia airplanes.

..."[The committee] hereby provisionally moves this Court to designate the bid of Cessna Aircraft Company ("Cessna") as the "best offer" under the terms of the Order Approving Bidding Procedures, Overbid Protection, Breakup Fee, and Form and Manner of Notice of Sale (the "Order") (Docket No. 179) even if the Cessna cash bid is lower than the cash bid offered by Park Electrochemical Corp. ("Park")," the motion reads. "The Owners Committee seeks this designation because, as established below, a Cessna acquisition of the Columbia Aircraft Manufacturing Corporation’s (the "Debtor") assets will prove far superior to a Park acquisition in terms of warranty protection and resale support for the more than 500 existing Columbia aircraft owners."

As ANN reported last week, Cirrus Design -- seen by some as the strongest competition to Cessna in the bidding for Columbia -- withdrew from the competition last week, stating the cost of making Columbia a viable addition to its product line, "will not be cheap." Cirrus also expressed concerns with the adaptability of its ballistic parachute recovery system to the existing Columbia airframe -- stating the time and cost involved was a concern, if in fact the system could be reverse-engineered at all.

Aerospace entreprenaur Granger Whitelaw, who had told owners he was interested in maintaining Columbia as a separate, dedicated manufacturer, also pulled his bid last week. In his letter to shareholders and creditors, Whitelaw said he would support either Cirrus or Cessna, so long as the winning company continued to build Columbia planes -- adding "if they do not follow up on their commitment, we will be here to pick up the pieces and rebuild the business as we had originally intended."

ANN will continue to follow this developing story throughout the day. Stay tuned.

FMI: www.flycolumbia.com, www.cessna.com