Boeing’s stock slips on $25B mixed-shelf registration of securities

Boeing’s (NYSE:BA) stock erased a gain in premarket trading Tuesday after the plane maker filed a mixed-shelf registration valued as much as $25 billion to help strengthen its financial position amid a prolonged factory strike. The shelf is a preliminary step before a possible equity increase, according to a regulatory filing on Tuesday.

The registration followed a $10 billion credit deal to bolster its balance sheet. Boeing (BA) will pay a funding fee of 0.5% of the aggregate principal amount of each advance made with the agreement, according to a statement on Tuesday.

The company’s losses have deepened since 33,000 workers went on strike last month, suspending production of its best-selling plane.

The aerospace and defense company is working to avoid ratings downgrades from Moody’s Ratings and S&P Global Ratings. Both credit ratings companies have said they might lower Boeing’s (BA) grades to junk status. Such a move would make borrowing more expensive for Boeing (BA) and make the company less appealing to some investors.

Boeing (BA) last week said it has a slim buffer in addition to the $10 billion of cash and short-term securities needed to avoid credit downgrades.

The strike is costing Boeing (BA) more than $1 billion a month despite its cost-saving efforts, S&P estimated last week. Before the work stoppage, Boeing’s (BA) output of its best-selling 737 Max was capped by air-safety officials in the wake of a mid-flight accident that forced an emergency landing.