FTC Imposes Major Divestiture Requirements on Boeing’s $8.3 Billion Spirit AeroSystems Deal

• Boeing must sell Spirit businesses that currently supply major components to Airbus, the FTC said.
• Boeing must also divest Spirit’s Subang, Malaysia, aerostructures plant to Composites Technology Research Malaysia.
• The decision follows coordinated review with regulators in the EU, the U.K., and the U.S. Department of War.

The Federal Trade Commission (FTC) on Wednesday placed major conditions on Boeing Co.’s (BA) planned $8.3 billion acquisition of Spirit AeroSystems (SPR). The commission requires Boeing to divest key Spirit operations to preserve competition in both the commercial and military aircraft sectors.

The action follows concerns that Boeing’s takeover of Spirit, a critical supplier of aircraft fuselages, wings, and other aerostructures, could give the company undue leverage over rivals.

What Are FTC’s Directives?

Under the FTC’s proposed consent order, Boeing must sell Spirit businesses that currently supply major components to Airbus. Those assets, along with the personnel needed to run them, must be transferred directly to Airbus. Boeing must also divest Spirit’s Subang, Malaysia, aerostructures plant, which serves both Boeing and Airbus, to Composites Technology Research Malaysia (CTRM).

The FTC argues that without these divestitures, Boeing could raise costs, disrupt supply, or gain access to sensitive proprietary information that would hurt competitors. The order also requires Boeing and Spirit to continue supplying aerostructures to military aircraft contractors without discrimination, while protecting confidential information belonging to rival defense firms.

To ensure compliance, a monitor will oversee the divestiture process and transitional services Boeing is required to provide to Airbus and CTRM.

The decision follows coordinated review with regulators in the EU, the U.K., and the U.S. Department of War.

How Did Stocktwits Users React?

Boeing’s shares slid over 2% on Wednesday while retail sentiment on Stocktwits turned ‘bullish’ from ‘extremely bullish’ a day earlier. Its year-to-date gains stand at 12%.

SPR stock climbed nearly 3% to its highest in over a month. Retail sentiment on the platform remained in the ‘bullish’ territory, while the stock has also recorded a 12% gain this year.

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