By (Reuters) -Boeing said on Tuesday it has entered a credit agreement worth $10 billion with a consortium of banks, as the U.S. planemaker readies financing sources amid a crippling strike and upcoming debt maturities.
The company’s shares rose 2% before the bell.
The latest development signals the planemaker is diversifying its financing options as it has $11.5 billion of debt maturing through Feb. 1, 2026.
Earlier this year, Boeing (NYSE:BA) committed to issuing $4.7 billion of its shares to acquire Spirit AeroSystems (NYSE:SPR) and assume its debt.
Boeing’s cash woes have worsened since roughly 33,000 of its workers represented by the Machinists union walked off their jobs in September, halting production of its best-selling 737 MAX aircraft.
The strike is costing the company more than $1 billion per month, according to one estimate that was released before Boeing announced it will cut 17,000 jobs or 10% 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 has posted operating cash flow losses of more than $7 billion for the first half of 2024 and had about $60 billion in debt, including the $10 billion it raised earlier this year.
The developments come at a time when Boeing is also looking to preserve its investment-grade credit rating amid the looming threat of a downgrade into junk territory, which will be the first for the planemaker.