Boeing's $4.7 Billion Spirit AeroSystems Deal Cleared in U.K.

Yahoo

5 days ago

U.K. antitrust officials said they wouldn't open an in-depth probe into Boeing's deal to acquire fuselage maker Spirit AeroSystems Holdings, effectively clearing the transaction weeks after they launched the first phase of an investigation.
The Competition and Markets Authority started looking at the deal in June to determine whether it could stifle competition in the U.K. Officials have now concluded that isn't the case and said the transaction didn't warrant a more in-depth probe.
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Boeing agreed to acquire Spirit in July last year in a roughly $4.7 billion deal that included Boeing-related commercial operations as well as commercial, defense and aftermarket operations.
Spirit, which split from Boeing about two decades ago, has been at the center of quality issues affecting 737 MAX jets. Spirit's factory in Wichita, Kan., made the fuselage involved in last year's Alaska Airlines door-plug blowout.
Boeing executives have said they believe taking control of Spirit's operations would improve the safety and quality of its manufacturing.
Clearance from the CMA brings the companies closer to finalizing the transaction. If U.K. antitrust officials had concluded the deal threatened competition, they could have blocked it altogether or imposed so-called remedies on Boeing, meaning the jet maker could have been forced to sell certain assets or make other concessions to earn antitrust approval.
A Boeing spokesperson said the company was pleased with the outcome and would continue to work through the remaining regulatory processes. Joe Buccino, a Spirit spokesperson, said progress continued toward completion of the deal, which is expected to close in the fourth quarter.
Aside from issues affecting Boeing jets, Spirit has also been under the spotlight for supply-chain snags that have slowed aircraft assembly for Boeing's European rival, Airbus. Airbus Chief Executive Guillaume Faury said repeatedly that challenges stemming from Spirit were putting pressure on plans to ramp up production of its A220 narrow-body and A350 wide-body aircraft.
Like Boeing, Airbus struck its own deal in April to take over some Spirit operations that make parts for its jets in the U.S., Europe and Africa, moving to take direct control of production in a bid to stabilize supply chains.
Write to Mauro Orru at [e-mail]
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