Boeing has sought to buy out key suppliers and made changes to how it pays for them, changes that could help the plane maker save money while addressing safety and quality concerns, according to two people familiar with the negotiations.
Boeing plans to use stock rather than cash to buy Spirit AeroSystems, said two people not authorized to discuss the deal publicly. One of the people added that Boeing plans to pay more than $4 billion for Spirit, which makes aviation parts including fuselages for the Boeing 737 Max, Boeing's most popular jetliner.
A person familiar with the discussions said the decision to switch from cash to shares was not expected to significantly delay the deal, which could be announced as early as next week.
Based on Tuesday's stock price, Spirit Airlines' market capitalization is more than $3.6 billion.
The news that Boeing was proposing to use its own stock, rather than cash, to buy Spirit Airlines was first reported by The Wall Street Journal.
The stock payments could improve Boeing's financial position as it invests in improving production quality. The Federal Aviation Administration limited the company's ability to ramp up production of the 737 Max, its most popular commercial jet, after the January crashes. Boeing said in May that cash from operations would exceed revenue this year.
The Spirit takeover talks are complicated by the fact that Spirit also supplies Boeing's biggest rival, Airbus, which is expected to take over Spirit's business making parts for the airline.
Federal investigators have said the plane involved in the January crash appears to have left a Boeing factory without the bolts needed to secure panels in place. In the months since, Boeing has taken a number of steps to improve quality. Last week, the company's CEO, Dave Calhoun, faced tough questioning from lawmakers about that incident and two other fatal Max crashes in late 2018 and early 2019.
Boeing's problems with the 737 Max have been exacerbated by the pandemic, which has disrupted supply chains across the aviation industry, and while supplies of materials and parts have recovered somewhat, they remain challenging.
Airbus on Monday lowered the number of commercial aircraft it plans to deliver to airlines this year to 770, down from about 800 previously. The Toulouse, France-based company said it was struggling to get enough engines, airframe structures and cabin equipment. As a result of the change and problems in its space business, Airbus lowered its profit and cash flow forecasts for 2024. The company's shares fell 10% on Tuesday after the announcement.
