Boeing, the aerospace giant, has successfully raised a whopping $20.7 billion through a dual stock offering. The company issued 112.5 million shares of common stock at a price of $143.00 per share, along with $5 billion in depositary shares representing a 1/20th interest in its new 6.00% Series A Mandatory Convertible Preferred Stock, priced at $50.00 per share. This offering significantly exceeded the company’s initial plan to issue 90 million common shares.
The underwriters have been granted a 30-day option to purchase an additional 16.875 million common shares and $750 million in depositary shares to cover over-allotments. The common stock offering is expected to close on October 30, 2024, and the depositary shares offering on October 31, 2024, pending customary closing conditions.
Boeing anticipates raising approximately $15.81 billion from the common stock offering and about $4.91 billion from the Depositary Shares Offering, assuming the over-allotment options are not exercised. The company intends to utilize the net proceeds for general corporate purposes, which may include debt repayment, working capital, capital expenditures, and investments in its subsidiaries.
Investors can gain exposure to Boeing’s stock through various exchange-traded funds (ETFs), including the First Trust Exchange-Traded Fund First Trust Indxx Aerospace & Defense ETF (MISL) and the Gabelli Commercial Aerospace and Defense ETF (GCAD).
The news of this successful offering has been met with enthusiasm by investors. As of the last check on Tuesday, BA shares are up 1.71% at $153.27. This positive stock performance reflects investor confidence in Boeing’s future prospects. The substantial capital raised through this offering will enable Boeing to pursue its strategic objectives and further solidify its position as a leading player in the aerospace industry.
This news comes amidst a backdrop of strong investor interest in the aerospace sector, driven by the global recovery in air travel and the ongoing demand for new aircraft. Boeing, with its extensive product portfolio and established market presence, is well-positioned to capitalize on this positive industry trend. The company’s ability to successfully raise such a substantial sum through its stock offering underscores its financial strength and its commitment to future growth.
