BY Fraser Tennant
In a move that sees it repurchase its former subsidiary, global aerospace company Boeing is to acquire aerostructures manufacturer and supplier Spirit AeroSystems in an all-stock transaction valued at approximately $4.7bn.
Under the terms of the definitive merger agreement, Boeing will acquire Spirit for $37.25 per share in Boeing common stock, which represents a 30 percent premium to Spirit’s closing stock price of $28.60 on 29 February 2024.
Boeing has long pondered buying back its former subsidiary, which aerospace analysts say has struggled to thrive independently despite diversifying into work for Europe’s Airbus and others.
“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,” said Dave Calhoun, president and chief executive of Boeing. “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.”
Boeing’s acquisition of Spirit will include substantially all Boeing-related commercial operations, as well as additional commercial, defence and aftermarket operations. As part of the transaction, Boeing will work with Spirit to ensure the continuity of operations supporting Spirit’s customers and programmes it acquires, including working with the US Department of Defence and Spirit defence customers regarding defence and security missions.
“After carefully evaluating Boeing’s offer to combine, we are confident this transaction is in the best interest of Spirit and its shareholders, and will benefit Spirit’s other stakeholders,” said Patrick M. Shanahan, president and chief executive of Spirit. “Bringing Spirit and Boeing together will enable greater integration of both companies’ manufacturing and engineering capabilities, including safety and quality systems.”
Concurrently with the closing of Spirit’s acquisition by Boeing, Spirit has entered into a binding term sheet with Airbus. Under the term sheet, the parties will continue to negotiate in good faith to enter into definitive agreements for Airbus to acquire certain Spirit assets that serve Airbus programmes.
The definitive merger agreement with Boeing and the term sheet with Airbus have been unanimously approved by the board of directors of Spirit.
Mr Shanahan concluded: “We are proud of the part we have played in Airbus’ programmes and believe bringing these programs under Airbus ownership will enable greater integration and alignment.”
News: Spirit Aero to be broken up as Boeing agrees $4.7 billion stock deal