Boeing to acquire Spirit AeroSystems in $35 per share stock deal

Boeing has offered to acquire Spirit AeroSystems Holdings in a deal funded mostly by stock that values its key supplier at about $35 per share, Bloomberg News reported, citing people familiar with the matter.

This offer represents a premium of nearly 6 per cent over Spirit’s stock closing price of $33.07 on Monday and a 22.4 per cent upside to its closing price on Feb. 29, the day before Boeing’s takeover talks became public.

Boeing switched its offer from an all-cash one and while the final terms of the latest offer are still being discussed, it could include a small amount of cash, Bloomberg reported, adding the deal is expected to be announced within a matter of days.

Spirit said it remains “focused on providing the best quality products for our customers”. Boeing did not immediately respond to a Reuters request for comment.

Boeing initiated talks earlier this year to buy back the Wichita, Kansas-based supplier it spun off in 2005, seeking to stabilize a key part of the supply chain for its strongest-selling jet following a mid-air blow out on a new 737 MAX in January.

Boeing has said it is buying back Spirit to secure safety and quality in its plants, after blaming Spirit for sending incomplete or faulty parts to its factories.

However, talks hit a stumbling block over Spirit’s work for Airbus (AIR.PA), with the European group threatening to block any deal that involved Boeing building parts for its newest models.

The deal will require Spirit to spin off some of its manufacturing plants to Airbus, Bloomberg reported.

Reuters earlier reported that Boeing and Airbus have broadly succeeded in dividing Spirit’s programs into work that Boeing will take back, along with work that the Airbus will take.

Spirit posted a net loss of $617 million and burned through $444 million in the first quarter, far more than analysts had expected.