Boeing To Launch New Bond Sale As Fitch Downgrades To Edge Of Junk

Boeing (BA +0.4%) unveils a sale of new bonds to help repay $2.8B of debt, issuing unsecured notes in four parts, according to an SEC filing.

The longest portion of the offering, a 10-year security, may yield around 300 basis points over U.S. Treasuries, Bloomberg reports.

At virtually the same time this morning, Fitch Ratings cut Boeing’s credit rating a notch to BBB-, the lowest investment-grade rating, with a negative outlook.

It may take another two years until Boeing’s financial metrics are more consistent with a higher credit rating, Fitch says.

The company also is rated BBB- with a negative outlook at S&P, while Moody’s has a BBB rating.

Boeing has burned through $22B in free cash since March 2019, when regulators grounded its 737 MAX jet after two fatal accidents; the company yesterday abandoned a forecast that it would stop burning cash next year.