Connect with us

Hi, what are you looking for?

Stock

Boeing to raise as much as $25 billion to shore up balance sheet

Boeing said Tuesday that it could raise as much as $25 billion in shares or debt over three years, a move to increase liquidity as the troubled manufacturer faces a more than monthlong machinist strike and problems throughout its aircraft programs.

“This universal shelf registration provides flexibility for the company to seek a variety of capital options as needed to support the company’s balance sheet over a three year period,” Boeing said in a statement.

Boeing shares are down nearly 42% this year as of Tuesday.

Bank of America aerospace analysts have estimated that Boeing will raise between $10 billion and $15 billion in equity.

“We expect Boeing to offer equity first, which should shore up the company’s balance sheet in the near term while maintaining the option to later issue equity debt with a lower risk of a credit downgrade,” BoFA analyst Ron Epstein wrote Tuesday.

Fitch Ratings said Boeing’s announcement Tuesday will “increase financial flexibility and moderate near-term liquidity concerns.”

Boeing is trying to shore up its balance sheet as it faces warnings from credit ratings agencies that it could lose its investment-grade rating.

S&P Global Ratings, one of the agencies that warned about a downgrade, last week estimated that the machinist strike is costing Boeing more than $1 billion a month. The two sides have been at an impasse.

Earlier, Boeing separately said in a filing that it has an agreement with a consortium of banks for a $10 billion credit agreement.

“The credit facility provides additional short term access to liquidity as we navigate through a challenging environment,” the company said in a statement. “The company has not drawn on this facility or its existing credit revolver.”

On Friday, Boeing’s new CEO, Kelly Ortberg, warned that the company plans to lay off about 17,000 employees, or 10% of its global workforce to cut costs.

“We need to be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery,” he said, adding that Boeing needs to focus resources on “areas that are core to who we are.”

The announcement came alongside preliminary financial results, showing mounting losses and $5 billion in charges in Boeing’s defense and commercial airplane units.

On Oct. 23, Ortberg will hold his first quarterly investor call since becoming Boeing’s CEO in August.

This post appeared first on NBC NEWS






    You May Also Like

    Investing

    Overview The world of business technology has evolved. Driven by the shift towards distributed work and cloud application delivery, enterprise infrastructure is undergoing a...

    Investing

    Overview Hempalta Corp. (TSXV:HEMP) is engaged in processing industrial hemp at scale to produce a range of consumer and commercial products. Its proprietary processing...

    Investing

    Overview ALX Resources (TSXV:AL,FWB:6LLN,OTC:ALXEF) is dedicated to providing shareholders with multiple opportunities for discovery by exploring a portfolio of prospective mineral properties, which include...

    Investing

    Overview Flynn Gold Limited (ASX: FG1) is an Australian mineral exploration company with a portfolio of projects in Tasmania and Western Australia. Tasmania is...

    Disclaimer: gorgeousincome.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.


    Copyright © 2024 gorgeousincome.com