Boeing Co. BA has announced the acquisition of Spirit AeroSystems Holdings Inc SPR in a $4.7 billion all-stock deal, in a bid to address the safety and regulatory challenges faced by its supplier.
What Happened: The acquisition, which has been in the works for several months, is part of Boeing’s strategy to resolve the safety and regulatory crisis that has impacted its key supplier. The total transaction value, including Spirit’s net debt, is approximately $8.3 billion, Boeing stated.
Under the terms of the deal, each share of Spirit common stock will be exchanged for a number of shares of Boeing common stock, resulting in an equity value of about $37.25 per share.
Boeing also revealed that Airbus EADSF will acquire certain commercial work packages that Spirit handles for Airbus as part of the Boeing-Spirit merger. Spirit is also considering the sale of some of its operations, including those in Belfast, non-Airbus operations in Northern Ireland, Prestwick, Scotland, and Subang, Malaysia. The deal is expected to close in mid-2025.
Why It Matters: The acquisition of Spirit AeroSystems is a significant move for Boeing, which has been grappling with a series of challenges, including the grounding of its 737 MAX aircraft. This acquisition is seen as a strategic step to address the issues faced by its supplier and to strengthen its position in the aerospace industry.
Price Action: Boeing Co closed at $182.01, down 0.27% on Friday. In after-hours trading, the stock rose 0.038%. Year to date, Boeing has declined by 27.70%, according to data from Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
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