News that Boeing Co. is interested in buying supplier Spirit AeroSystems Holdings Inc. was met with a mix of surprise and skepticism on Wall Street Friday. The Wall Street Journal reported earlier Friday that Boeing was interested in buying Spirit AeroSystems, a supplier that is at the center of several recent quality problems confronting the aerospace and defense company.
The report cited people familiar with the talks. Spirit AeroSystems
SPR,
+14.97%
did not immediately return a request for comment about a potential deal. Boeing
BA,
-1.34%
said it does not have “anything to add.” Investors will want to know whether this acquisition would solve the quality issues at Boeing, but the short answer to that question is no, at least not in the near term, Ken Herbert of RBC Securities said in a note Friday. Broadly speaking, the aerospace industry is trending toward more vertical integration after several years of outsourcing, Herbert said. But the news that Boeing is pursuing Spirit AeroSystems came as a surprise, he said. “We do not believe acquiring [Spirit AeroSystems] represents a near-term fix” for Boeing and the concerns about its 737 Max airplanes, Herbert said. Moreover, a purchase would add to Boeing’s near-term execution issues, even though Spirit was once part of the aerospace and defense giant, he said. On the flip side, there are potential long-term benefits for Boeing from “greater int …
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The report cited people familiar with the talks. Spirit AeroSystems
SPR,
+14.97%
did not immediately return a request for comment about a potential deal. Boeing
BA,
-1.34%
said it does not have “anything to add.” Investors will want to know whether this acquisition would solve the quality issues at Boeing, but the short answer to that question is no, at least not in the near term, Ken Herbert of RBC Securities said in a note Friday. Broadly speaking, the aerospace industry is trending toward more vertical integration after several years of outsourcing, Herbert said. But the news that Boeing is pursuing Spirit AeroSystems came as a surprise, he said. “We do not believe acquiring [Spirit AeroSystems] represents a near-term fix” for Boeing and the concerns about its 737 Max airplanes, Herbert said. Moreover, a purchase would add to Boeing’s near-term execution issues, even though Spirit was once part of the aerospace and defense giant, he said. On the flip side, there are potential long-term benefits for Boeing from “greater int …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]