Boeing lines up $35b in funds via stock and bond sale

Boeing filed papers with the US markets regulator on Tuesday for raising up to $25 billion (AED 91 billion) through a stock and debt offering and entered into a $10 billion (AED 36.7 billion) credit agreement amid a crippling strike and upcoming debt maturities.

The planemaker is looking to strengthen its finances that have been strained due to a slump in production of its best-selling 737 MAX jet following a door panel blowout and a strike by thousands of union workers.

It was not clear when and how much Boeing will raise via the stock offering, but analysts and investors expect the company to raise money before the year-end as debt maturities loom.

Shares of the planemaker reversed course to trade down 0.3 per cent in premarket trading.

Boeing said in a statement it had not drawn on the new $10 billion (AED 36.7 billioni) credit facility or its existing credit revolver.

"These are two prudent steps to support the company's access to liquidity," Boeing said, adding that the credit agreement provides additional short term access to liquidity as it navigates through a "challenging environment."

"This universal shelf registration provides flexibility for the company to seek a variety of capital options as needed to support the company's balance sheet over a three year period," Boeing said, referring to its filing with the US Securities and Exchange Commission.

The company had cash and cash equivalents of $10.89 (AED 37 billion) billion as of June 30.

The strike is costing the company more than $1 billion(AED 3.67 billion) per month, according to one estimate that was released before Boeing announced it will cut 17,000 jobs or 10 per cent of its global workforce.

The planemaker was already reeling due to a regulator-imposed cap on production of its MAX jets after a mid-air cabin-panel blowout in January.

Boeing delivered 33 jets in September, down from 40 in August.