By David Shepardson
(Reuters) – Boeing (NYSE:) will launch its plan to raise more than $15 billion in capital as early as Monday, a source briefed on the matter told Reuters.
Reuters first reported on Oct. 16 that the aircraft maker was nearing a plan to raise about $15 billion in common stock and a mandatory convertible bond as it looks to shore up finances worsened by a crippling ongoing strike.
The new capital will come from a mix of equity sales and convertible preference shares, the source added, saying the total amount raised could increase based on demand.
Boeing declined to comment on Sunday.
Bloomberg News previously reported the expected timing of Monday’s capital increase.
Last week, machinists voted nearly two to one to reject Boeing’s latest offer to end the strike that has halted production of the 737 MAX.
The company said in official filings earlier this month that it could raise as much as $25 billion in equity and debt if its investment-grade credit rating is at risk.
The aerospace giant has faced increased regulatory scrutiny, production cuts and a loss of customer confidence since a door panel blew off a 737 MAX plane in early January.
Boeing has been burning cash all year and last week reported a new quarterly loss of $6 billion. Earlier this month, Boeing said it had entered into a $10 billion credit agreement with major lenders: Bank of America, Citibank, Goldman Sachs and JPMorgan.
Boeing said earlier this month it would cut 17,000 jobs — 10% of its global workforce — and delay the first deliveries of its 777X aircraft by a year.
The three major credit rating agencies – S&P, Moody’s (NYSE:) and Fitch – have said they will downgrade Boeing’s ratings to ‘junk’ if it takes on new debt without paying down some $11 billion in debt that until February 1, 2026.
