KANSAS- Spirit Aerosystems, the manufacturer of fuselages for Boeing’s 737 Max jets, experienced a significant surge in its shares on Friday following reports of ongoing discussions about a potential acquisition by Boeing.
Both companies are actively working to address manufacturing flaws in the popular 737 MAX aircraft.
Boeing to Buy Spirit Aerosystems
As of late morning on Friday, Spirit’s shares had risen by 13%, while Boeing’s shares were down approximately 1% in response to the news. Notably, Spirit Aerosystems held a market capitalization of $3.3 billion as of the previous day’s closing.
According to the Wall Street Journal’s report on Friday, Spirit has engaged the services of bankers to explore various options and has initiated preliminary discussions with Boeing.
In 2005, Boeing separated its operations in Kansas and Oklahoma, forming what is now known as Spirit Aerosystems. Approximately 70% of Spirit Aerosystems’ revenue last year was derived from Boeing, with around a quarter generated from manufacturing components for Boeing’s primary competitor, Airbus.
The discussions about a potential repurchase by Boeing have surfaced less than two months after a segment of a Boeing 737 MAX 9 aircraft experienced an incident during an Alaska Airlines (AS) flight. This prompted the Federal Aviation Administration (FAA) to temporarily ground all 737 Max planes in January, leading to investigations into the incident and scrutinizing Boeing’s production processes.
This incident marks the most recent and significant among a series of issues faced by the Boeing 737 Max, which is Boeing’s top-selling aircraft.
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