Boeing Offers to Acquire Spirit Aero for $35 per Share

In a maneuver aimed at bolstering its supply chain, Boeing Company (BA) has reportedly offered to acquire Spirit AeroSystems Holdings, Inc. (SPR), a key supplier of fuselages for its popular 737 aircraft. The offer, detailed by Bloomberg News on June 24, 2024, citing sources familiar with the matter, proposes a purchase price of $35 per Share, paid primarily in Boeing stock.

This offer represents a modest premium of nearly 6% over Spirit AeroSystems’ closing stock price on June 24th.  However, it signifies a more significant increase of 22.4% compared to the company’s closing price on February 29, 2024, before news of potential acquisition talks emerged.

The rationale behind Boeing’s offer appears twofold.  First, it seeks to establish greater control over a critical component of its supply chain, particularly in the wake of production disruptions experienced with the 737 MAX aircraft.  Second, the all-stock structure of the proposed deal suggests a strategic intent to leverage Boeing’s share price, potentially offering Spirit AeroSystems shareholders an upside if Boeing’s stock value increases.

Spirit AeroSystems emerged as a separate entity in 2005 following a spin-off from Boeing.  The company has since become a prominent supplier of fuselages and other components for Boeing aircraft.  However, the relationship hasn’t been without its challenges, with Spirit AeroSystems facing production delays that impacted Boeing’s aircraft production schedules.

News of Boeing’s renewed interest in acquiring Spirit AeroSystems comes amid ongoing talks between the two companies. Details regarding Spirit AeroSystems’ official response have not yet been made public. However, industry analysts anticipate that the proposal will be carefully evaluated by Spirit AeroSystems’ board of directors, considering the immediate financial incentive and the long-term implications for the company’s future as an independent entity.

Boeing’s potential acquisition of Spirit AeroSystems signifies a significant development within the aerospace industry.  The coming weeks will likely reveal further details regarding the negotiations and the ultimate fate of this proposed deal.