Analysts regard Boeing Co.’s (NYSE:BA) plans to raise as much as $25 billion through a mixed offering of common stock as a “positive.”
What Happened: Alongside this capital raise, the aerospace manufacturer has secured a $10 billion credit agreement with a consortium of leading financial institutions, including Bank of America, Citibank, Goldman Sachs, and JPMorgan.
According to Bank of America analysts, the three-year time horizon for the capital raise is a smart move.
“We expect Boeing to offer equity first, which should shore up the company’s balance sheet in the near term while maintaining the option to later issue debt with a lower risk of a credit downgrade,” the analysts said in a note Tuesday.
The $10 billion credit facility also includes escalators tied to Boeing's credit rating, potentially raising the borrowing rate by as much as 62.5 basis points if the company’s financial standing deteriorates.
Analysts currently maintain a ...
