Boeing's Spirit Acquisition Turns Sour as Hidden Liabilities Surface
Boeing's recent acquisition of Spirit AeroSystems has started to look like a costly mistake. The aerospace company paid $8.4 billion for Spirit in December, hoping to address supply chain issues. However, it appears that Spirit had more problems than Boeing anticipated, with 'hundreds of millions of dollars in additional liabilities' discovered since the deal closed.
Although these losses don't show up on Boeing's income statements due to accounting rules, they still represent a significant burden for the company. This is just another headwind for investors, according to a report by the Wall Street Journal.
Despite this setback, there is some good news for Boeing. A cargo carrier in India, Afcom, has set up an initial purchase agreement for four Boeing 777F aircraft. This would be a significant upgrade in capacity for Afcom and a decent sale for Boeing as well.