Boeing Acquires Spirit AeroSystems

 

Boeing has agreed to acquire Spirit AeroSystems for $4.7 billion to address quality issues in its 737 MAX jets production.

 

Boeing, facing production problems, has clinched a deal to buy Spirit AeroSystems, the troubled fuselage maker it split off two decades ago. The $4.7 billion all-stock transaction, priced at $37.25 per share, includes Spirit’s defense and aftermarket operations.

 

Spirit AeroSystems, a key supplier for Boeing, has been central to quality issues affecting the 737 MAX jets. Boeing executives believe that regaining control over Spirit’s operations will enhance the safety and quality of its manufacturing processes.

 

Spirit, which had $6 billion in revenue last year but has been losing money, will shed factories in Europe that produce parts for Airbus. The acquisition is one of the significant moves by departing CEO David Calhoun to address Boeing’s manufacturing challenges after a near midair tragedy in January.

 

Since October, Spirit has been led by Pat Shanahan, a 30-year Boeing veteran. Shanahan left Boeing in 2017 to serve in the Department of Defense and has discussed taking over the Boeing CEO role. These talks were paused during the acquisition negotiations.

 

Spirit’s factory in Wichita, Kansas, was involved in the Alaska Airlines door-plug incident in January due to defective rivets. The incident highlighted ongoing quality issues at Spirit, impacting Boeing's production and delivery schedules.

 

Boeing has slowed its factories recently, delivering less than half as many jets compared to the end of 2023. This reduction has strained several suppliers, including Spirit, which announced job cuts in its Wichita plant in May.