Yahoo Finance Boeing to buy supplier Spirit AeroSystems in $4.7bn deal
Boeing has agreed a $4.7bn (£3.7bn) deal to buy the parts supplier it sold nearly 20 years ago, as it seeks to improve safety on its production lines after a panel blew off an Alaska Airlines-operated plane mid-flight earlier this year.
The under-pressure US planemaker will buy Spirit Aerosystems, which supplies it with fuselage and wing parts, as it attempts to improve safety and quality in its manufacturing processes.
Talks to buy back Spirit began just weeks after a door panel blew out in mid-air on one of Boeing’s 737 Max 9s in January, shortly after it took off from Portland, Oregon.
Related: US accused of offering Boeing ‘sweetheart deal’ over fatal crashes
Investigations by the US safety regulator later discovered the panel appeared to be missing four key bolts. The National Transportation Safety Board said the four bolts were removed while workers repaired damaged rivets last year at Boeing’s facility in Renton, Washington.
The deal to bring Spirit back in house marks a shift away from Boeing outsourcing key components for its planes. Spirit was spun off from Boeing in 2005 but it still accounts for about 70% of all of its orders, with roughly 25% coming from Airbus – Boeing’s arch-rival.
The Boeing president and chief executive, Dave Calhoun, said: “By reintegrating Spirit, we can fully align our commercial production systems, including our safety and quality management systems, and our workforce to the same priorities, incentives and outcomes – centred on safety and quality.”
Airbus will take over the part of Spirit’s business in Northern Ireland that makes wings and fuselage for its A220 jet. Spirit is one of Northern Ireland’s largest manufacturing employers, with about 3,500 staff across the country.
About 40% of Spirit jobs in Northern Ireland are linked to production for companies including Bombardier and Rolls-Royce, and Airbus has said it will aim to sell some of these parts.
Boeing will pay Airbus $559m in compensation to take over operations at four of its plants, including the plant in Belfast.
The total transaction value is about $8.3bn when Spirit’s net debt is included, Boeing said. Spirit shareholders will receive $37.50 a share as part of the deal.
It was revealed on Sunday that the US Department of Justice is poised to charge Boeing with fraud. However, plans to offer the planemaker a plea deal – according to sources familiar with the matter – have infuriated the loved ones of hundreds of passengers who died in two fatal crashes five years ago.
Boeing will be granted until the end of this week to decide whether it will plead guilty to the charge and avoid trial, officials told families of those onboard the fatal Lion Air flight 610 and Ethiopian Airlines flight 302, which claimed 346 lives.
Attorneys representing the relatives accused the federal government of cooking up “another sweetheart plea deal” with Boeing.
