Boeing (BA, Financial) is contemplating the sale of its renowned navigation division, Jeppesen, as part of efforts to manage financial pressures. The potential sale price for Jeppesen could exceed $6 billion, attracting interest from several aviation suppliers and private equity firms.
Companies such as Raytheon and Honeywell International are currently evaluating the acquisition. Additionally, private equity firms like Advent, Blackstone Group, Carlyle Group, Thoma Bravo, Veritas Capital, and Warburg Pincus have shown interest in Jeppesen, with a deadline set for the first round of bidding.
Other potential bidders assessing this interactive flight planning business include General Electric Aerospace (GE) and TransDigm Group (TDG). Jeppesen, which Boeing acquired in 2000 for $1.5 billion in cash, has a broad customer base ranging from airlines to amateur pilots and is considered a non-core asset that Boeing is willing to divest to reduce its $58 billion debt burden.
Last year, Boeing faced its largest strike in history, with a significant portion of its commercial airplane factory workforce on the West Coast halting work. The strike, which lasted seven weeks, was due to demands for higher wages and better benefits. It concluded in early November when Boeing agreed to a new contract offering a 38% pay increase over four years, ending the strike and resuming production. Despite these challenges, Boeing reported a fourth-quarter loss of $5.46 per share, significantly higher than analysts' expectations of a $1.57 per share loss.
