Bulletin: Boeing Co.'s Use Of Equity For Spirit AeroSystems Acquisition Is Better For Long-Term Credit Metrics

NEW YORK (S&P Global Ratings) July 1, 2024--Boeing Co. announced that it has reached an agreement to acquire Spirit AeroSystems Inc. (Spirit) in a transaction valued at $8.3 billion. Spirit shareholders will receive Boeing shares equivalent to $37.25 per share of Spirit stock, representing equity value of approximately $4.7 billion. Boeing will also assume approximately $3.6 billion of Spirit's debt. The announcement does not affect our 'BBB-' issuer credit rating and negative outlook on the company. We note that use of equity will lessen the negative effect of the proposed deal on Boeing's leverage and reduces its sensitivity to weaker-than-expected cash flow generation on its credit measures over the next few years. The use of equity is a constructive change

...NEW YORK (S&P Global Ratings) July 1, 2024--Boeing Co. announced that it has reached an agreement to acquire Spirit AeroSystems Inc. (Spirit) in a transaction valued at $8.3 billion. Spirit shareholders will receive Boeing shares equivalent to $37.25 per share of Spirit stock, representing equity value of approximately $4.7 billion. Boeing will also assume approximately $3.6 billion of Spirit's debt. The announcement does not affect our '###-' issuer credit rating and negative outlook on the company. We note that use of equity will lessen the negative effect of the proposed deal on Boeing's leverage and reduces its sensitivity to weaker-than-expected cash flow generation on its credit measures over the next few years. The use of equity is a constructive change from the company's original plan to fund a potential acquisition with all cash. The transaction as proposed will nevertheless result in incrementally weaker credit measures immediately after the close due to limited earnings contribution...

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