Parts of a Boeing Co. 737 fuselage lie on the assembly floor at Spirit AeroSystems in Wichita, Kansas.
Daniel Aaker | Bloomberg | Getty Images
Boeing said on Monday it would buy back its struggling fuselage maker Spirit AeroSystems The aircraft maker has said the all-stock deal will improve safety and quality control.
It said it agreed to pay $37.25 per share in Boeing stock for Spirit, giving the aerospace company an equity value of $4.7 billion. Boeing said the deal values the transaction at $8.3 billion, including Spirit’s debt. Spirit’s shares closed at $32.87 per share on Friday, giving it a market capitalization of about $3.8 billion.
Boeing revealed in March that it would Talks are ongoing for acquisition The Wichita, Kansas-based company took the step just weeks after a fuselage panel from a nearly new Boeing 737 Max 9 tore off in mid-air. Alaska Airlines The flight has created a new crisis for Boeing. Spirit makes the fuselage for the 737 and other parts, including parts for Boeing’s 787 Dreamliner.
In 2005, Boeing spun off its operations in Kansas and Oklahoma, which became today’s Spirit AeroSystems. Boeing accounted for about 70% of Spirit’s revenue last year, while about a quarter came from making parts for Airbus, Boeing’s main rival, according to securities filings.
CEO Dave Calhoun, who said he will step down at the end of the year, said Monday that bringing Spirit into the company would “perfectly align” the companies’ production systems and workforces.
“This is one of many significant steps we are taking as a company that demonstrates our unwavering commitment to strengthening quality and ensuring that Boeing is the company the world needs,” Dave Calhoun said in a message to employees.
He said he expects the deal to be completed by mid-2025, subject to approval of the sale by regulators, Spirit shareholders and operators of Spirit’s dedicated fleet of Airbus aircraft.
Spirit CEO Pat Shanahan is being considered as a possible replacement for Calhoun.
Meanwhile, Airbus said on Monday it had reached an agreement with Spirit to pay the European plane maker $559 million for Spirit’s purchase of its manufacturing lines dedicated to Airbus planes. These include operations in Belfast, Northern Ireland, where the A220 wings and mid-fuselage are produced, A220 pylons in Wichita, Kansas, and A350 fuselage sections in North Carolina.
Increasing pressure
The National Transportation Safety Board’s preliminary report into the Jan. 5 crash said it appeared the bolts holding the door plug in place were not attached to the Max 9 when it left Boeing’s factory and was handed over. Alaska Airlines Several months before the accident.
This was the most serious of Boeing aircraft production problems, with Spirit-built aircraft having holes drilled incorrectly in the fuselage and fuselage panels incorrectly attached.
The crisis sparked by the burst door-plug on the Alaska flight has slowed deliveries of new Boeing planes to airlines, and caused financial losses for both Spirit and Boeing. In May, Boeing’s CFO said the company Burning cash instead of generating it Boeing shares are down more than 30% this year — about $8 billion through the first half of 2024.
One way Boeing has improved quality is to accept only defect-free fuselages, so that repairs or additional manufacturing steps do not have to be performed, reducing the chance of errors.
The Federal Aviation Administration has said it will not allow Boeing to expand production until it is satisfied with its production lines.
Calhoun Criticism by MPs The company’s safety record was questioned at a Senate hearing in June, with some senators lamenting that it had not improved since the two deadly Max crashes.
