Boeing to raise up to $25 billion to shore up its balance sheet

Boeing said Tuesday it could raise up to $25 billion in stock or debt over three years, a move aimed at boosting its liquidity as the struggling automaker faces a machinists’ strike that has lasted more than a year. months and problems in its aircraft programs.

“This universal registration provides the company with the flexibility to pursue various capital options necessary to support its balance sheet over a three-year period,” Boeing said in a statement.

Earlier, Boeing separately said in a filing that it had reached an agreement with a consortium of banks for a $10 billion credit deal.

“The credit facility provides additional short-term access to liquidity as we navigate a challenging environment,” the company said in a statement. “The company has not used this facility or its existing revolving credit.”

Boeing shares have fallen nearly 43% this year through Monday’s close.

Boeing is trying to shore up its balance sheet as it faces warnings from credit rating agencies that it could lose its investment grade rating.

S&P Global Ratings, one of the agencies that has warned of a downgrade, estimated last week that the machinists’ strike would cost Boeing more than $1 billion a month. The two sides are at an impasse.

New Boeing CEO Kelly Ortberg warned on Friday that the company plans to lay off about 17,000 employees, or 10% of its global workforce, to cut costs.

“We must be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery,” he said, adding that Boeing must focus its resources on ” areas that are essential to who we are.”

The announcement came alongside preliminary financial results, showing mounting losses and $5 billion in charges at Boeing’s defense and commercial aircraft units.

On October 23, Ortberg will hold his first quarterly conference call with investors since becoming CEO of Boeing in August.