Hawker Pacific Aerospace had big plans.

The Sun Valley-based firm, which specializes in repairing and refurbishing landing gear for large commercial jets, wanted to transform itself from strong regional player into a multinational powerhouse.

In early 1997, it saw an opportunity to accomplish just that by purchasing the landing-gear maintenance operations of British Airways plc.

But with the British Airways unit commanding a selling price of around $25 million, more than 50 percent of Hawker Pacific’s 1997 revenues, the deal seemed unattainable.

“We needed to do this acquisition,” said Brian Aune, Hawker’s chief financial officer. “But we needed to raise equity money to do so.”

So at the advice of its investment banks, Everen Securities Inc. and Seidler Cos. Inc., Hawker Pacific decided to raise the money by going public.

“Our investment bankers convinced us that the market was ripe and we could successfully launch an IPO,” Aune said.

But going public, even during a bull market, is no easy task, especially for a relatively small company whose management already has its hands full just running the day-to-day operations. The IPO process was further complicated by Hawker Pacific simultaneously trying to close the British Airways acquisition.

“It’s a pretty time-consuming process,” said Aune. “You don’t realize how time consuming until you have been through it.”

One of the most complex tasks was being audited in preparation for the creation of a prospectus.

The Securities and Exchange Commission requires that any company wanting to go public provide two years of audited financial statements.

Because Hawker Pacific throughout its 30-year history had been either a division of a much larger company or, as was the case at the time of the IPO, an entity privately held by investment funds, no accounting firm had rendered an opinion on financial performance. As a result, Aune and the rest of the company’s management spent much of 1997 poring over past balance sheets.

Finally, after months of drafting and redrafting a prospectus, it received SEC approval to go ahead with its IPO.

In the winter of 1997, Hawker’s management team, accompanied by investment bankers, hit the road to pitch the company to potential investors.

“It is like a marathon to see how many investors and cities you can visit in a day,” he said. “And it was winter time, so the weather was pretty unforgiving.”

On one typical day, the group spent the morning in Portland, Ore., the afternoon in Seattle and then flew to Chicago in the evening to prepare for the next day’s meetings.

Like all road shows, Hawker Pacific wrapped up its two-week, 15-city tour in New York. Its IPO went out on Jan. 29, with 55 percent of the company being sold to the public. Through the offering, Hawker Pacific raised $20.8 million, of which $2.8 million went to cover expenses, such as investment bankers’ and lawyers’ fees.

But management had no time to celebrate.

With the IPO barely transacted, they were off to the United Kingdom to close the deal with British Airways. They remained there for a few weeks looking over their new acquisition, counting inventory and getting to know the staff.

“We didn’t have a chance to have our (IPO) closing dinner until about six weeks later,” Aune said.

Being a public company has its advantages and drawbacks.

Coverage by equity analysts, along with increased press coverage, has provided a higher profile which, in turn, has brought in more business. And if the company needs more cash in the future, it can issue new stock through a secondary offering.

On the downside, Hawker Pacific’s managers now have to consider the short-term impact that their actions will have on the company’s share price, whereas in the past they were freer to focus on the long-term vision.

The importance of keeping investors pleased became all too apparent recently after the company posted weak earnings for the third quarter ended Sept. 30.

Hawker Pacific just managed to break even, compared with net income of $300,000 (4 cents a share) in the like quarter a year earlier and net income of $1 million (17 cents a share) in the second quarter ended June 30.

In response to that earnings decline, the share price fell to around $3.50 as of last week, down from a 52-week high of more than $14 a share in April.

Ironically, the earnings drag is coming from the newly acquired British Airways division that prompted Hawker to go public in the first place.

Part of the problem has been that, under terms of the acquisition, any of the division’s workers who quit within one year of the deal are eligible to receive British Airways’ generous severance package. As a result, Hawker is suffering a larger-than-expected staff turnover.

Though the company’s share price has fallen more than 70 percent from its high, Aune said he is not concerned about a possible hostile takeover bid, because only about 55 percent of the equity is publicly traded.

“A takeover wouldn’t work unless there was insider involvement,” he said.