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Boeing Considering Raising $10bn via Share Sale
October 2, 2024
Boeing is considering raising at least $10bn through new stock sale to replenish its cash reserves impacted by an ongoing strike, according to the sources. The company is consulting with advisers to explore this option, but any equity raise is unlikely to occur for at least a month given the pending resolution of the strike involving 33,000 workers. Boeing aims to assess the financial impact of the strike before making a decision. The sources noted that no final decision on timing or amount has been reached, and Boeing may ultimately choose not to proceed with the plan. The company is under pressure to strengthen its finances and maintain its investment-grade credit rating, as a downgrade to sepculative territory would increase the cost of servicing its $58bn debt. Boeing’s situation has worsened due to a three-week ongoing strike that has halted production of its single-aisle airliner, further depleting cash reserves. Earlier, the company has made a ‘final offer’ to adress the demands of the workers on strike. This adds to Boeing’s woes, following a near-catastrophic accident in January that led to reduced production of its key 737 Max airliner.
Boeing’s bonds traded stable with its 2030s at 100.5, yielding 5.03%.
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