Spirit AeroSystems gains on report it’s close to funding agreement with Boeing

Spirit AeroSystems (NYSE:SPR) edged higher by 0.3% after a report that the struggling supplier is close to reaching a funding agreement with Boeing (BA) that would give it a cash lifeline.

A deal may be announced in the next few days, according to a Reuters report on Friday, which cited people familiar with the matter. Spirit Aero is also considering some asset sales, such as U.S. defense composites maker Fiber Materials.

Spirit could not be immediately reached to comment by Reuters. Boeing declined to comment.

The Reuters report comes after Spirit (SPR), Boeing’s (BA) key supplier and acquisition target, on Tuesday disclosed it raised substantial doubt about its ability to continue as a going concern amid mounting losses, rapid cash burn and production challenges.

“The company will require additional liquidity to continue its operations over the next 12 months,” it disclosed in its 10-Q filing, adding that it expects to continue generating operating losses for the “foreseeable future.”

Spirit Aero (SPR) said it has been facing bloated inventory and lower cash flows due to recent changes in the production and delivery process implemented by Boeing (BA).