Boeing Plans To Launch Capital Raise Of Over $15 Bln To Improve Liquidity Amid Challenges : Report

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(RTTNews) - Boeing Co. (BA) is planning to launch a capital raise as early as Monday, aiming to enhance its liquidity amid ongoing challenges, Bloomberg reported citing people familiar with the matter.

The company is expected to raise over $15 billion through this fundraising effort, with the total potentially increasing based on demand. The transaction is likely to involve both equity shares and debt that can be converted into equity, the report said.

Last week, Boeing announced that it entered into a $10 billion supplemental credit agreement with BofA Securities, Inc., Citibank, N.A., Goldman Sachs Lending Partners LLC, and JPMorgan Chase Bank, N.A.

On Wednesday, the International Association of Machinists and Aerospace Workers Local 751 announced that 64% of its members voted to reject a new labor contract proposal from Boeing. As a result, the strike would continue at all designated picket locations.

Boeing's latest proposal included a 35% pay hike over four years, a $7,000 ratification bonus, a reinstated incentive plan, and enhanced contributions to workers' 401(k) retirement plans. This features a one-time $5,000 contribution along with up to 12% in employer contributions. However, the offer does not restore the traditional pension plan that was removed from union members a decade ago.

More than 33,000 members of the IAM at Boeing locations in Washington state, Oregon, and California have been on strike since September 13.

Earlier this month, Boeing announced plans to lay off approximately 10% of its workforce, or about 17,000 employees, amid ongoing financial losses and production delays caused by the strike involving union machinists.