Boeing (BA) said Wednesday it expects to wrap up its planned $4.7 billion purchase of Spirit AeroSystems (SPR) before the end of the year after receiving a green light from the Federal Trade Commission, provided it completes a series of required divestitures, most of which have already been negotiated with Airbus (OTCPK:EADSF) (OTCPK:EADSY), Reuters reported.
Following the FTC’s decision, Boeing (BA) shares slipped about 3%, while Spirit’s stock gained roughly 3.5%, reflecting investor reactions to the regulator’s attempt to ease competition concerns surrounding the deal. Spirit (SPR) is the world’s largest independent aerostructures manufacturer and a key supplier to both major planemakers.
The transaction effectively breaks apart Spirit (SPR), which was spun out of Boeing (BA) in 2005 and has since struggled with financial losses and manufacturing issues. Boeing (BA) will bring back the majority of Spirit’s (SPR) operations, including the Wichita site responsible for 737 fuselage production, while Airbus (OTCPK:EADSF) (OTCPK:EADSY) will assume control of facilities in North Carolina and Belfast, Northern Ireland. Taken together, including Airbus’s share of the assets and related adjustments, the overall value of the deal is about $8.3 billion.
Spirit (SPR) has faced quality and delivery challenges across several aircraft programs, contributing to delays for Boeing’s 737 line as well as Airbus’s A350 and A220 jets.
Under the FTC’s proposed order, Spirit (SPR) must complete the previously arranged divestiture of its Subang, Malaysia, operations, which supply components to both Airbus and Boeing, to Composites Technology Research Malaysia.
The order also requires Spirit (SPR) to remain available as a supplier to other defense contractors competing for next-generation military aircraft programs. Boeing (BA) earlier this year secured the Pentagon’s contract for the first sixth-generation fighter, the F-47, and is bidding on the Navy’s F/A-XX program.
To ensure compliance, regulators intend to install two independent monitors: one reporting to the FTC and another representing the Department of Defense. The oversight structure is meant to prevent Boeing from gaining undue leverage over Airbus’s supply chain or limiting competition in the defense sector.
Boeing (BA) said it was pleased with the FTC’s approval and reiterated that it intends to complete the remaining steps needed to close the acquisition, Reuters reported, citing a company spokesperson. Spirit (SPR) also confirmed that it expects the deal to be finalized by the end of December.
Bringing Spirit (SPR) back into the fold is central to Boeing’s (BA) effort to improve manufacturing quality and stabilize output of the 737.
For Airbus (OTCPK:EADSF) (OTCPK:EADSY), the agreement grants direct ownership of the Belfast operation, a storied former Short Brothers site that recorded an estimated $670 million loss in 2024 and warned in July that it needed additional funding to meet its obligations. As part of the transaction, Airbus will receive $439 million in cash to offset the financial burden associated with taking over the facility.