Did Personal Connections Drive Boeing to Acquire a Share of Vought’s South Carolina Company?

(NewsVisual, powered by IntellectSpace) -- The Boeing Company (NYSE: BA) announced on Friday that it was buying a share of Global Aeronautica, LLC from Vought Aircraft Industries, and its possible that some personal connections between senior officials from Boeing and Vought helped to spur the deal forward.

“After the transaction is complete, Global Aeronautica will become a 50-50 joint venture between The Boeing Company and Alenia North America, a subsidiary of Italy's Alenia Aeronautica,” Boeing said in its statement.

This deal makes very good sense for Boeing from a purely business perspective.

Global Aeronautica is a South Carolina-based fuselage sub-assembly facility for Boeing's newest airplane, the 787 Dreamliner.  So it would make sense for Boeing to seek ownership of Global in order to have more managerial control over the plane’s production.

Boeing Reports Positive Earnings and Record Backlog for 2007

(NewsVisual, powered by IntellectSpace) -- During a year when American companies in the financial sector were sustaining billions of dollars in record losses, The Boeing Company (NYSE: BA) had an increase in full-year net income of 84 percent to $4.1 billion, the company said in a statement.

The company’s fourth-quarter revenue grew to $17.5 billion that resulted in $1.36 in earnings per share, while the stock garnered $5.28 per share for 2007.

It also reported that its backlog reached a record $327 billion.

In addition, Boeing also took several steps during the fourth-quarter to shore up its share price: it repurchased 9.4 million shares for a price of $890 million; it also decreased consolidated debt by 5 percent.

“Our 2007 results demonstrate the kind of quality financial performance we can achieve through our simultaneous focus on growth and productivity,” said CEO/President/Chairman Jim McNerney in the statement.

Directors’ Business Involvement at Boeing Likely to Help Keep Company on Right Course

While the stock market experienced the jitters due to an uptick in the jobless rate, the Boeing Co (NYSE: BA) defied the market pessimism by announcing that its 2007 sales exceeded all of the previous records.

More specifically, a total of 80 different customers ordered new Boeing airplanes in 2007, bringing the net commercial airplane orders up to 1,413 for the year.  In addition, the company’s production lines will be busy for the next few years, since Boeing Commercial Airplanes now has over 3,400 unfulfilled airplane orders. 

“It has been another strong year for commercial aviation, and we are grateful for our customers' trust in our team, and our products and services,” said Boeing Commercial Airplanes CEO/President Scott Carson.

Furthermore, Carson underscored Boeing’s competitive advantage over Airbus by stressing that Boeing had the vision to offer its customers cost-efficient aircraft, when he added:

“We are able to offer more new-technology airplanes to our customers than ever before, aircraft that are quieter and more fuel efficient, with significantly lower carbon dioxide emissions and reduced impact on local communities.”

Boeing Board Leadership Valuable as Third Quarter Earnings Announced

Despite news that Boeing has once again delayed the delivery of its highly anticipated 787, the company’s outlook appears positive as it announced its better than expected third quarter earnings (see article from SEC Investor). In light of these encouraging results, we created an IntellectSpace Knowledge Map of Boeing’s current Board connections (Note: the information contained and presented in Knowledge Maps is public information from the Securities and Exchange Commission of the United States of America).

As illustrated in this Knowledge Map, all of the Directors at Boeing hold concurrent Board Memberships at other corporate entities. The connections are shown to be especially diverse, with ties to Edison International and the Walt Disney Company through John E Bryson as well as links through Rozanne L Ridgeway to Sara Lee, Manpower, 3M Company, and Emerson Electric. Other notable entities connected to Boeing through its board are JP Morgan Chase through John H Biggs, Nortel Networks through Mike S Zafirovski, and Allstate through Edward M Liddy.

These numerous current board affiliations suggests a strong degree of leadership experience by the Boeing Board of Directors. Such a network that is both strong and diverse will likely prove valuable to the company as it continues into the next year.