Boeing to Acquire Spirit AeroSystems in $4.7 Billion Deal After Months of Negotiations

Boeing said the total deal value was about $8.3 billion including debt.
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A Major Acquisition

Boeing has announced its plan to acquire Spirit AeroSystems in a $4.7 billion all-stock deal. This decision follows months of negotiations and aims to address a significant corporate and industrial crisis involving one of its key suppliers. The total deal value, including debt, is approximately $8.3 billion.

Deal Details

According to Boeing, each share of Spirit common stock will be exchanged for between 0.18 and 0.25 Boeing shares, resulting in an equity value of around $37.25 per share. Spirit’s shares had closed at $32.87 the previous Friday, as reported by Reuters.

Impact on Airbus

In a related development, Airbus, another major customer of Spirit, announced that it would take over core activities at four of Spirit’s plants located in the United States, Northern Ireland, France, and Morocco. Minor activities in Wichita, Kansas, are also included in this part of the deal.

This move by Airbus was triggered by Boeing’s decision to reacquire its former subsidiary, Spirit AeroSystems, which had become an independent supplier to various aerospace companies, including Airbus, nearly two decades ago.

Compensation and Plant Sales

Because the Airbus-related activities were unprofitable, industry sources indicated that Airbus sought up to $1 billion in compensation for taking over these plants, which manufacture strategic parts for the A350 and A220 jets. Airbus will receive $559 million in compensation from Spirit, depending on the final details of the deal, while paying a symbolic $1 for the assets.

Spirit also announced plans to sell its businesses and operations in Prestwick, Scotland, and Subang, Malaysia, which support Airbus programs. Additionally, it plans to sell operations in Belfast, Northern Ireland, that do not support Airbus programs.

Looking Ahead

Boeing expects the Spirit AeroSystems acquisition to close by mid-2025. This strategic move is anticipated to streamline operations and resolve ongoing issues, marking a significant step forward for Boeing in stabilizing its supply chain and strengthening its market position.

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