Boeing to acquire Spirit AeroSystems in $4.7bn deal
Boeing has announced a definitive agreement to acquire long-time supplier Spirit AeroSystems, manufacturer of the 737 MAX fuselage, as part of a deal to improve safety and quality. Rival manufacturer…
July 1, 2024
Boeing has announced a definitive agreement to acquire long-time supplier Spirit AeroSystems, manufacturer of the 737 MAX fuselage, as part of a deal to improve safety and quality. Rival manufacturer Airbus is also looking to independently acquire elements pertaining to production of its A220 and A350 aircraft.
Boeing’s merger with spin-off Spirit AeroSystems will take the form of an all-stock transaction at an equity value of approximately $4.7 billion, with the total transaction value roughly $8.3 billion (including Spirit’s last reported net debt).
The acquisition will include “substantially all Boeing-related commercial operations, as well as additional commercial, defense and aftermarket operations,” clarified Boeing, with outgoing president and CEO Dave Calhoun stating that the 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,” he added.
After divesting the parts supplier in 2005, Boeing has remained Spirit’s largest customer since – although following January’s mid-flight door plug blowout on an Alaska Airlines 787 MAX, the Federal Aviation Administration (FAA) capped production at Spirit to 30 787 fuselages a month amid ongoing quality control assurance issues.
Airbus has also entered into a binding term sheet agreement with Spirit AeroSystems “in relation to a potential acquisition of major activities related to Airbus”. These concern the production of A350 fuselage sections in North Carolina and France, A220 wings and mid-fuselage elements in Northern Ireland and Morocco, and A220 pylons in Kansas.
“With this agreement, Airbus aims to ensure stability of supply for its commercial aircraft programmes through a more sustainable way forward, both operationally and financially,” said Airbus, which will be compensated through a payment of $559 million from Spirit for a nominal consideration of $1.
Subject to a successful due diligence process, “all parties are willing and interested to work in good faith to progress and complete this process as timely as possible,” concluded Airbus.
