This post was originally published on this site
Boeing Co. BA, -1.56% has lined up at least $12 billion in bank loans and may tap the commercial paper market to counter the cash drain from the 737 Max crisis.
The aerospace giant said in a regulatory filing that it expects to close a two-year loan in February after securing bank commitments, and has the option to increase the facility if it is oversubscribed.
The planned loan would help fund compensation for buyers of the grounded jet and support Boeing suppliers after the company halted production of the Max. The added funds would also pay for Boeing’s stock dividend, which it opted to keep at existing levels this year.
The aircraft maker ended 2019 with $10 billion in cash, a level of liquidity that Boeing has maintained in recent years, tapping the bond market twice last year and doubling the size of its revolving loan facility.
“We believe our ability to access external capital resources should be sufficient to satisfy existing short-term and long-term commitments and plans,” the company said in the filing.
