Boeing is buying Spirit AeroSystems for $4.7 billion

Boeing announced plans to acquire key Wichita-based Spirit AeroSystems for $4.7 billion ($37.25 per share).

WICHITA, Kan. (KSNW) - Boeing announced plans late Sunday to acquire key Wichita-based Spirit AeroSystems for $4.7 billion ($37.25 per share).

Boeing previously owned Spirit, and the purchase would reverse a longtime Boeing strategy of outsourcing key work on its passenger planes.

Concerns about safety came to a head after the Jan. 5 blowout of a panel on an Alaska Airlines 737 Max 9 at 16,000 feet over Oregon. No one was seriously injured in the Alaska Airlines door incident, which terrified passengers. The Federal Aviation Administration soon after announced increased oversight of Boeing and Spirit, which supplied the fuselage for the plane.

“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,” Boeing President and CEO Dave Calhoun said in a statement late Sunday.

Boeing's acquisition of Spirit will include substantially all Boeing-related commercial operations, as well as additional commercial, defense and aftermarket operations. As part of the transaction, Boeing will work with Spirit to ensure the continuity of operations supporting Spirit's customers and programs it acquires, including working with the U.S. Department of Defense and Spirit defense customers regarding defense and security missions.

"We are proud of the role Boeing plays in supporting our men and women in uniform and are committed to ensuring continuity for Spirit's defense programs," said Calhoun.

Airbus and Spirit have also entered into a binding term sheet under which Airbus will acquire, assuming the parties entered into definitive agreements and receipt of any required regulatory approvals, certain commercial work packages that Spirit performs for Airbus concurrently with the closing of the Boeing-Spirit merger. In addition, Spirit is proposing to sell certain of its operations, including those in Belfast, Northern Ireland (non-Airbus operations), Prestwick, Scotland, and Subang, Malaysia.

The transaction is expected to close in mid-2025 and will be subject to the sale of the Spirit operations related to the Airbus commercial work, including regulatory and Spirit shareholder approvals.

Last October, Spirit removed its CEO and replaced him with Patrick Shanahan, a former Boeing executive who served as acting defense secretary in the Trump administration.

Things seemed to be going more smoothly until the Alaska Airlines incident. Investigators said a panel used in place of an extra emergency door had been removed at a Boeing factory to let Spirit workers fix damaged rivets, and bolts that help hold the panel in place were missing after the repair job. It is not clear who removed the bolts and failed to put them back.

Spirit said in May that it was laying off about 450 workers in Wichita because of a production slowdown since the January incident. Its total workforce was just over 13,000 people.

“Bringing Spirit and Boeing together will enable greater integration of both companies’ manufacturing and engineering capabilities, including safety and quality systems,” Shanahan said.

The merger comes as the U.S. Justice Department is pushing Boeing to plead guilty to criminal fraud in connection with two deadly plane crashes involving its 737 Max jetliners. If Boeing rejects the plea offer, the Justice Department will seek a trial in the matter.

Boeing has until the end of the week to accept or reject the offer, which includes the giant aerospace company agreeing to an independent monitor who would oversee its compliance with anti-fraud laws, according to several people who heard federal prosecutors detail a proposed offer Sunday.