The long-awaited approval of Boeing’s reacquisition of Spirit AeroSystems has received EU approval, as anticipated, with the planned divestitures of units supplying Airbus and a Malaysian composites operation required to close the deal.
Under the terms of the approval, all operations that supply Airbus will be spun off directly to Airbus. The Malaysian composites operation, which also supplies Airbus, will be spun off to Composite Technologies Research Malaysia (“CTRM”) which will emerge as an independent supplier in aviation composites.
Originally negotiated in July, 2024, the approvals have taken 15 months to complete, keeping the supply chain in a state of flux. The transaction is expected to close as soon as possible, within the 4th quarter, which should expedite the transition of activities from Spirit AeroSystems to Boeing, Airbus, and CTRM.
The Bottom Line
The re-integration of Spirit AeroSystems into Boeing will improve quality, keep production of 737 MAX fuselages under Boeing control, and enable Boeing’s quality measurement practices to be fully executed within the former Spirit Aero operations. It will also enable Airbus to gain control over the elements of the supply chain that Spirit Aero provided, ensuring that the big two are not parts suppliers to each other.
This approval has been expected ever since the negotiations were concluded more than a year ago, with the key question being why has approval taken so long. All of the parties wanted the deal closed as quickly as possible, as each would benefit from increase control of their respective supply chains. Now that the deal has finally been approved, Boeing and Airbus can focus on closing and the integration activities needed to transfer the workload appropriately.
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