Boeing to buy Spirit Aerosystems in $4.7bn deal

1st Jul 2024 07:22

(Sharecast News) - Boeing said on Monday that it has agreed to buy Spirit AeroSystems in a $4.7bn all-share deal.

Under the terms of the acquisition, Boeing will pay $37.25 per share, giving a total transaction value of about $8.3bn including Spirit's last reported net debt.

Boeing president and chief executive Dave Calhoun said: "We believe this deal is in the best interest of the flying public, our airline customers, the employees of Spirit and Boeing, our shareholders and the country more broadly.

"By reintegrating Spirit, we can fully align our commercial production systems, including our Safety and Quality Management Systems, and our workforce to the same priorities, incentives and outcomes - centred on safety and quality."

The acquisition will include substantially all Boeing-related commercial operations, as well as additional commercial, defence and aftermarket operations. As part of the deal, Boeing will work with Spirit to ensure the continuity of operations supporting Spirit's customers and programs it acquires, including working with the US Department of Defense and Spirit defence customers regarding defence and security missions.

Airbus and Spirit have also entered into a binding term sheet under which Airbus will acquire certain commercial work packages that Spirit performs for Airbus concurrently with the closing of the Boeing-Spirit merger.

Spirit is also proposing to sell certain of its operations, including those in Belfast, Northern Ireland (non-Airbus operations), Prestwick, Scotland, and Subang, Malaysia.

The transaction is expected to close mid-2025 and is subject to the sale of the Spirit operations related to certain Airbus commercial work packages and the satisfaction of customary closing conditions.

Russ Mould, investment director at AJ Bell, said: "Boeing's decision to acquire Spirit AeroSystems and bring it back in-house, having spun it off in 2005, makes sense. The company was at the heart of the manufacturing defects and safety concerns over its 737 Max airliner which have put the Boeing's share price into a tailspin. This move gives Boeing more control."