Airplane manufacturer Boeing Co. (BA) is buying its fuselage supplier Spirit AeroSystems (SPR) in a deal valued at $4.7 billion U.S.
The deal comes after months of negotiations and as Boeing takes steps to improve its manufacturing quality.
Boeing has agreed to pay $37.25 U.S. a share for Spirit AeroSystems. The deal values the company at $4.7 billion U.S., or a total of $8.3 billion U.S. including outstanding debt.
In a statement, Boeing said the acquisition will enable it to “…align our commercial production systems, including our Safety and Quality Management Systems…”
Boeing’s production of commercial aircraft has slowed dramatically this year as the company faces enhanced oversight from aviation regulators following several safety issues with its aircraft.
The acquisition by Boeing will end Spirit’s decadeslong independence as a fuselage maker and parts supplier.
Spirit AeroSystems was an internal operating unit of Boeing until 2005 when the plane maker sold it to a private-equity firm. A year later, Spirit was taken public at $26 U.S. per share.
The stock of Spirit AeroSystems jumped on news of the Boeing takeover and is up 10% on the year at $33.97 U.S. per share. However, the stock is down 57% over the last five years.
Boeing’s stock is down 25% this year and down 48% over the last five years, trading at $186.70 U.S. currently.
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