July 25 Spirit Aerosystems said on
Thursday that it was laying off about 360 workers in Kansas and
Oklahoma, a step that came amid talk of a possible bid for the
company by UK aerospace and car parts maker GKN.
The layoffs affect salaried support and management employees
and are a strategic step to make the aerospace supplier more
cost-competitive, Spirit said in a statement.
The company, based in Wichita, Kansas, makes airplane body
sections for the best-selling Boeing 737 and Airbus A320
jets, as well as wing pieces and other components for
other aircraft makers, including Bombardier,
Gulfstream and Mitsubishi.
The layoffs come amid talk that UK car and aerospace
supplier GKN might bid for part or all of the company.
Spirit's shares rose 7.4 percent on Thursday after a British
newspaper reported on a potential GKN offer.
Shares were up $1.78 to $25.85 in mid-day trading in New
York. Earlier, the shares traded above their 52-week high of
The Daily Mail said speculation about a bid rose on
Wednesday, with dealers hearing GKN could launch "a $5 billion
cash and shares bid, worth around $35 a share," for Spirit.
The newspaper said Bank of America/Merrill Lynch was
reported to be advising GKN. Other sources said a deal might be
in the works for the wings business.
Ken Evans, a spokesman for Kansas-based Spirit, said the
company declined to comment.
In March, Spirit named former Lockheed Martin
executive Larry Lawson as president and chief executive, and is
undergoing a strategic and financial review of its operations at
four locations, including Kansas and Oklahoma. It suffered
losses last year from cost overruns on some aircraft parts.
Spirit was spun off from Boeing in 2005.
"If this report turns out to be true, then we think that it
offers an excellent deal for Spirit's shareholders," RBC Capital
Markets analyst Robert Stallard said in a note to clients on
"Given the lack of profitability on its development
programs, and a lack of cash generation, a bid at the reported
level would seem extremely generous given the current
situation," Stallard added.
Jefferies analyst Sandy Morris expressed doubts about a GKN
acquisition of Spirit. "My personal view is that perhaps one
division of Spirit may be for sale, and that would be the wing
systems division. I think that that's much more likely," Morris