Boeing Reaches an Agreement with Spirit AeroSystems

Boeing has suffered serious reputational and financial damage in the last couple of years. The aviation giant is trying to deal with these challenges, but it won’t be easy to solve them in a short period of time.

The company made an important announcement on Monday. According to Boeing, it will acquire Spirit AeroSystems, which used to belong to Boeing, in an all-stock deal.

Boeing needs to improve safety and quality control, as it doesn’t want to lose more money due to safety-related issues.

The company agreed to pay $37.25 per share in Boeing stock for Spirit, valuing the company at $4.7 billion in equity. However, it must also be noted that Spirit isn’t a debt-free company. Including Spirit’s debt, the deal’s transaction value totals $8.3 billion. On Friday, shares of Spirit AeroSystems closed at $32.87.

Several months ago, the aviation giant disclosed it was in talks to acquire Spirit AeroSystems. As a reminder, Spirit AeroSystems is based in Wichita, Kansas.

What’s Next for Boeing?

Spirit manufactures fuselages for the 737 and other components, including sections of Boeing’s 787 Dreamliners.

As stated earlier, Spirit AeroSystems was part of Boeing. However, Boeing spun off its operations in Kansas and Oklahoma more than a decade ago, forming the present-day Spirit AeroSystems.

In 2023, Boeing accounted for about 70% of Spirit’s revenue. Spirit AeroSystems also makes parts for Airbus. It is no secret that Airbus is the main rival of Boeing.

Importantly, Airbus also made an important announcement recently. The aviation giant announced an agreement with Spirit AeroSystems.

As part of the agreement, Spirit AeroSystems will compensate Airbus $559 million for acquiring its manufacturing lines dedicated to Airbus planes.

The deal includes a production site in Belfast, Northern Ireland. Airbus A220 wings and mid-fuselage sections are made in Belfast.

The current CEO of Boeing, Dave Calhoun, expects the deal with Spirit AeroSystems to close by mid-2025, pending approval from regulators. Shareholders of Spirit AeroSystems should also approve the deal.

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