Boeing (BOE, Washington National) has secured USD10 billion in credit from lenders and announced plans to issue up to USD25 billion in shares or debt over the next three years to address ongoing operational challenges exacerbated by recent labour disputes.

In a regulatory filing on October 15, the plane maker announced a USD10 billion supplemental credit agreement with BofA Securities, Citibank, Goldman Sachs Lending Partners, and JP Morgan Chase Bank as joint lead arrangers and book managers. Citibank will serve as the administrative agent, while BofA, Goldman, and JPMorgan will act as co-syndication agents, along with a syndicate of lenders defined in the credit agreement.

In a separate filing on the same day, the company disclosed plans to raise up to USD25 billion through various securities offerings, including senior and subordinated debt, common and preferred stock, and stock purchase contracts.

The Wall Street Journal reported that analysts expressed satisfaction that Boeing was tackling its immediate cash crunch while also setting the stage to raise additional funds in the coming years.

The new USD10 billion credit agreement adds to about USD10 billion in existing untapped revolving credit, bringing Boeing's net debt to USD45 billion. Credit-rating agencies have cautioned that the company must raise capital to avoid a potential downgrade of its debt to junk status.

The strategic financial moves came hard on the heels of the company's announcement that it needed to lay off 17,000 workers (about 10% of it workforce) and delay B777-9 and B777-8F deliveries, warning its third-quarter results on October 23 would reflect financial impacts from charges related to certain programmes in its Commercial Airplanes and Defense, Space & Security segments, plus an ongoing strike by the International Association of Machinists and Aerospace Workers.

The company expects third-quarter revenue of USD17.8 billion and operating cash flow of USD1.3 billion. At the end of the quarter, cash and investments in marketable securities amounted to USD10.5 billion.