Boeing has agreed to buy its longtime supplier Spirit AeroSystems for $4.7bn in a deal struck at a time when the embattled aerospace giant has been plagued by safety scandals and the Department of Justice is poised to offer a plea deal for criminal charges connected to two deadly crashes.
The two companies announced the acquisition in a statement late on Sunday.
“We believe this deal is in the best interest of the flying public, our airline customers, the employees of Spirit and Boeing, our shareholders and the country more broadly,” Boeing President and CEO Dave Calhoun said in the statement.
The total value of the deal, which includes Spirit’s last reported net debt, is around $8.3bn, Boeing said.
Spirit also manufactures and supplies key parts for Boeing aircraft. The aerospace giant previously owned Spirit before spinning out the company in 2005 as part of plans to make Boeing a “large-scale systems integrator” of work largely done by suppliers through aggressive outsourcing and divestments.
However, such an approach would later come under scrutiny after a faulty door panel, manufactured by Spirit, blew off a Boeing 737 MAX plane mid-air during an Alaska Airlines flight in January.
Several passengers on board were injured in the incident, which grounded all Boeing 737 MAX 9s and prompted investigations by the FAA and the National Transportation Safety Board into the aircraft manufacturer and Spirit AeroSystems.
Reports released since have suggested the plane did not have the critical bolts it needed to keep the door plug in place when it left the factory. Meanwhile, several whistleblowers have also come forward with safety concerns about Boeing.
Amid the safety scandal and the subsequent increased scrutiny from regulators, Congress and airlines, Boeing said bringing the supplier back into the fold would improve plane quality and safety.
“By reintegrating Spirit, we can fully align our commercial production systems, including our Safety and Quality Management Systems, and our workforce to the same priorities, incentives and outcomes — centered on safety and quality,” Calhoun said.
The agreement comes as it emerged that the Department of Justice is poised to offer Boeing a deal to plead…
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