In a bold move to address the challenges posed by a corporate and industrial crisis, Boeing has announced its intention to acquire Spirit AeroSystems in a $4.7 billion all-stock deal. This decision comes after months of negotiations between the two companies, signaling a significant shift in the aerospace industry landscape.
According to Boeing, the total value of the deal, including assumed debt, amounts to approximately $8.3 billion. Under the terms of the agreement, each share of Spirit common stock will be exchanged for between 0.18 and 0.25 Boeing shares, equating to an equity value of around $37.25 per share. This represents a premium compared to Spirit’s closing stock price of $32.87 on the Friday preceding the announcement.
As part of the transaction, Airbus, another major customer of Spirit AeroSystems, will be taking over key operations at four of the supplier’s plants across different countries. This development is a direct consequence of Boeing’s decision to repurchase Spirit, which had expanded its business to serve Airbus and other manufacturers after being spun off from Boeing nearly twenty years ago.
Given that the Airbus-related activities at these plants have been operating at a loss, industry insiders had anticipated Airbus to seek compensation in the range of up to $1 billion. However, the final agreement stipulates that Airbus will receive $559 million from Spirit, while paying a nominal sum of $1 for the assets. Furthermore, Spirit has outlined plans to divest its operations in Prestwick, Scotland, Subang, Malaysia, and Belfast, Northern Ireland, with a focus on aligning its business more closely with Airbus programs.
Boeing has indicated that the acquisition of Spirit AeroSystems is slated to be finalized by mid-2025. This extended timeline reflects the complexity of the deal and the need to navigate various regulatory and operational considerations. As both companies move forward with integrating their operations, the implications of this acquisition are expected to reverberate throughout the aerospace sector for years to come.
The Boeing-Spirit AeroSystems acquisition marks a pivotal moment in the history of both companies and the broader aerospace industry. As they embark on this new chapter together, the challenges and opportunities that lie ahead will require strategic foresight and collaborative efforts to succeed in a rapidly evolving market environment.