Boeing’s $4.7 Billion Acquisition Of Spirit Gets Conditional EU Antitrust Approval

Boeing Co.’s (BA) acquisition of Spirit AeroSystems Holdings Inc. (SPR) received approval from the European Union on Tuesday, conditional upon full compliance with the commitments offered by the companies.

The European Commission noted that Boeing had offered to divest all of Spirit’s businesses that supply aerostructures to Airbus, including assets and personnel, to the latter. In addition to this, the aerospace giant also offered to divest Spirit’s Malaysian business that sells supplies to Airbus, to Malacca, Malaysia-based Composites Technology Research Malaysia.

The European Commission stated that Boeing’s remedies “fully address the competition concerns” that it identified. “They will enable Airbus to integrate Spirit's businesses that currently supply aerostructures to Airbus into Airbus' own operations, and hence secure its supply chain. Also, they will allow a new competitive force, CTRM (Composites Technology Research Malaysia), to enter the market for aerostructures,” it added.

Boeing’s shares were up nearly 0.4% in Tuesday morning’s trade. Retail sentiment on Stocktwits around the company trended in the ‘bullish’ territory.

The European Commission had set October 14 as the deadline for making a decision. This comes after the U.K.’s Competition and Markets Authority cleared Boeing’s acquisition of Spirit unconditionally in August.

Boeing announced the Spirit deal last year that carved up the world’s largest aerostructures company between itself and Airbus. At the time, Boeing stated that it would assume substantially all Boeing-related commercial operations, as well as other commercial, defense, and aftermarket operations.

The aerospace giant’s acquisition of Spirit comes after a spinoff in 2005. This will bring back Spirit, a key supplier of the Boeing 737, 787 Dreamliner, and other commercial jets, into Boeing’s fold at a time when the company is looking to improve its quality controls.

BA stock is up 21% year-to-date and 39% over the past 12 months.

Also See: Jamie Dimon Sees ‘Early Signs’ Of Excess In Corporate Lending Amid Bankruptcies In US Auto Market: Report

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