Boeing Co. is planning to raise more than $15 billion in capital as early as Monday. The company aims to enhance its liquidity with common shares and convertible bonds to maintain its finances (reported by Reuters).
According to a Bloomberg report, “The company is set to raise more than $15 billion from the fundraising, one of the people said, adding that the amount could still rise depending on demand. Boeing’s advisers have been lining up potential investors for the offering, according to people familiar with the matter, who asked not to be identified as the information isn’t public.”
People aware of the news said that the transactions involve shares and debt that can be converted into equity. On 23 October, the company received clearance from the US Securities and Exchange Commission that it could raise $25 billion to sell stock and debt at risk of investment-grade credit.
Boeing previously announced the credit agreement with BofA Securities, Inc., Citibank, N.A., Goldman Sachs Lending Partners LLC, and JPMorgan Chase Bank, N.A., to reach $10 billion.
However, Boeing’s finances worsened by the “crippling ongoing strike.” The International Association of Machinists and Aerospace Workers Local 751 informed that around 65% of workers rejected a new labor contract proposal. This resulted in a continuous labor strike.
Moreover, Boeing offered a new proposal of a 35% pay hike over four years, a $7000 ratification bonus, a retirement plan, 12% in employer contributions, and more to end the strike.
The company loses around $6 billion in cash flow quarterly and cut off 17,000 jobs almost 10% of its global workforce. It delays the first deliveries of its 777X jet by a year.
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