A U.S. regulator said on Wednesday it would require Boeing to divest significant Spirit AeroSystems assets to resolve competition concerns about its $8.3 billion acquisition of the company that manufactures major parts of wings and fuselages for jetliners, including the Boeing 737.
The Federal Trade Commission order could complicate the merger, which Boeing had aimed to close by the end of the year. There is a 30-day public comment period for the proposed order. The FTC said Boeing and Spirit can close their transaction before that period ends, but the order would require further regulatory oversight.
Boeing’s share price was down 3.2% in intraday trading.
The commission wants the U.S. planemaker to divest parts of Spirit that supply aerostructures to its European rival Airbus AIR.PA. The three companies have already negotiated Airbus buying parts of Spirit.
The order also requires Spirit to continue as a supplier to Boeing’s competitors vying for future military aircraft programs. Boeing’s defense division won the contract for the U.S. military’s first sixth-generation fighter, the F-47, earlier this year, and it is competing for the U.S. Navy’s F/A-XX fighter contract.
The divestments would address the FTC’s concerns that the merger would allow Boeing to unfairly control Airbus’ supply chain and box out competitors in the defense industry.
“We welcome the U.S. Federal Trade Commission’s approval of our acquisition of Spirit AeroSystems,” a Boeing spokesperson said. “While the transaction has not yet fully closed, we are committed to completing the remaining steps necessary to finalize the acquisition. This milestone will further enhance our ability to manufacture safe, high-quality airplanes for our customers and benefit the flying public.”
