Boeing asks shareholders for $19 billion to protect its credit rating

The troubled American aircraft manufacturer, Boeing, asked investors to pump about $19 billion to support its balance sheet and protect its credit rating from the possibility of it being reduced to an “undesirable” rating by investors. The company, whose finances have come under pressure due to a number of safety issues, in addition to a month-long strike, announced its plans last Monday, after reporting a loss of $6 billion in the third quarter. The company plans to sell 90 million new shares, for about $14 billion based on the current share price in the market, in addition to five billion dollars in depositary shares that will be converted into preferred shares.

The company, headquartered in Virginia, declined to expand its filing on the financial market, indicating that any funds raised would be used for “general corporate purposes.”

Just two weeks ago, the company indicated that it would try to raise about $25 billion from investors. Analysts expect that the new shares will be priced close to the current market price. Boeing stock prices closed last Monday, with a decline of $4.32, or 2.8%, at $150.69, a decline of 40% since the beginning of this year.

Boeing is one of the two largest companies in the world that manufactures commercial aircraft, and it has been facing a series of crises since it was forced to ground its 737 MAX aircraft, following two devastating accidents in 2018 and 2019 that led to the deaths of about 345 passengers, including The two aircraft crews.

The company’s reputation suffered another blow in January of this year, when an explosion occurred in one of the doors of its planes and was thrown into the air, while the plane was in the middle of its flight, which prompted the company’s regulatory body to impose a limit on the production of “737 MAX” aircraft. The impact of regulatory controls on production, as well as the strike, was revealed in the company’s financial statements last week, when it announced a loss of $6.2 billion for the quarter ending at the end of last September. From the British newspaper The Times