Boeing is looking for a $19 billion boost

A Boeing sign on a facility in Seattle.

Boeing needs cash, and it’s trying to raise almost $19 billion as the company looks to boost its liquidity.

The planemaker announced Monday that it is offering 90 million common shares and about $5 billion of depositary shares for sale. Based on Friday’s closing share price of $155.01, that’s worth about $18.95 billion in total.

This news comes after Boeing filed a prospectus earlier this month stating that it may sell up to $25 billion in securities, including bonds, new shares, and stock options.

That’s on top of the $10 billion credit agreement that it entered into with Bank of America, Citibank, Goldman Sachs, and JPMorgan Chase, according to a regulatory filing on October 14.

Boeing said in a statement that it “intends to use the net proceeds from the Offerings for general corporate purposes, which may include, among other things, repayment of debt, additions to working capital, capital expenditures, and funding and investments in the Company’s subsidiaries.”

When the prospectus was filed, the company described the fundraising efforts as “two prudent steps to support the company’s access to liquidity,” adding that it would help the company “navigate through a challenging environment.”

News of the offering comes as the company faces a troubled financial outlook.

Last Wednesday, Boeing reported a net loss of $6.1 billion in its third-quarter earnings. It recorded a loss of more than $1.4 billion in the previous quarter.

Boeing’s shares are down nearly 40% since the start of the year, and credit ratings agencies have said its bonds are at risk of being downgraded to junk status.

Also in its third-quarter earnings, it reported an increase in its spending on its Starliner project by $250 million. To date, it has spent $1.85 billion on the Starliner program.

2024 has been a challenging year for Boeing.

In January, an Alaska Airlines Boeing 737 Max lost a door plug in midair — sparking regulatory scrutiny and customer frustrations that saw former CEO Dave Calhoun resign.

Boeing is also facing an ongoing workers’ strike. It started on September 13 after union members rejected a proposal to hike wages by 25% over four years. Last Wednesday, Boeing workers rejected a proposal with a 35% wage increase over four years.

Ron Epstein, a Bank of America analyst, estimated the strike was costing Boeing $50 million daily.

Earlier this month, Boeing announced plans to lay off 10% of its workforce and a further delay to its much-anticipated 777X program.

News of the share offering looks set to push Boeing’s stock price higher on Monday, with shares up 0.8% in premarket trade.