Boeing acquiring supplier Spirit AeroSystems for $4.7B
Boeing acquiring supplier Spirit AeroSystems for $4.7B
Boeing said Monday that it plans to purchase Spirit AeroSystems in a $4.7 billion all-stock deal decades after it spun off the supplier.
The planemaker has for years outsourced parts of its production process to the Spirit. But as Boeing seeks to rehabilitate its safety and quality record after the door plug of a Boeing 737 Max 9 blew off during an Alaska Airlines flight in January, the move would give the company more oversight and control of manufacturing processes amid ongoing scrutiny by federal regulators, lawmakers and the Department of Justice (DOJ).
“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 Boeing President and CEO Dave Calhoun, who announced in March that he plans to step down at the end of the year.
Spirit CEO Pat Shanahan, a former Boeing executive and acting Defense secretary during the Trump administration, said in a statement that “bringing Spirit and Boeing together will enable greater integration of both companies’ manufacturing and engineering capabilities, including safety and quality systems.”
Boeing gave the Federal Aviation Administration (FAA) an 11-page plan to improve its quality control problems in May. The federal regulator told The Hill it is committed to working with the aviation giant to make sure those changes are made.
But the Alaska Airlines incident revived concerns about promises Boeing made to improve its safety and quality issues in the wake of fatal Boeing 737 Max 8 crashes that killed 346 people in 2018 and 2019.
The DOJ said in May it believes Boeing violated a deferred prosecution agreement related to the crashes, and it would decide whether to prosecute the planemaker by July 7.
A lawyer representing the families of the crash victims said Sunday the DOJ is preparing to offer Boeing a plea deal.
The potential deal includes a $244 million fine and three years of probation and oversight by an external monitor, Paul Cassell told The Hill, criticizing it as a “sweetheart deal.”
“The deal will not acknowledge, in any way, that Boeing’s crime killed 346 people. It also appears to rest on the idea that Boeing did not harm any victim,” said Cassell. “The families will strenuously object to this plea deal.”
Calhoun apologized to the victims’ families during his appearance before a Senate permanent subcommittee on investigations last month.
Spirit also supplies parts to Boeing’s competitor, Airbus, which announced Monday it has entered into a binding term sheet agreement with the supplier.
“Whilst there is no guarantee that a transaction will be concluded, all parties are willing and interested to work in good faith to progress and complete this process as timely as possible,” Airbus said in a statement.
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