Jamie Spencer
Boeing announced on Tuesday that it will sell parts of its Digital Aviation Solutions business, including the navigation unit Jeppesen, to private equity firm Thoma Bravo for $10.55 billion. This sale is part of CEO Kelly Ortberg’s strategy to reduce Boeing’s debt by offloading non-core assets. The move follows Boeing’s efforts to streamline its business while retaining its core digital capabilities that serve commercial and defense customers with fleet maintenance, diagnostics, and repair services.
Jeppesen Deal Marks a Major Move for Boeing
The deal is considered one of the largest carve-out transactions in recent history, with Jeppesen, which Boeing acquired for $1.5 billion in 2000, drawing strong interest from private equity firms and aerospace suppliers. Thoma Bravo won the auction, surpassing competitors such as TPG, Advent, and Veritas. Jeppesen’s final price came in higher than Boeing’s initial expectations, which were set at $6 billion.
The deal is significant not just in terms of its size but also because of Jeppesen’s role within the aerospace industry. The company, based in Englewood, Colorado, has long been a valuable asset due to its ability to provide vital navigation services to a range of clients in both the commercial and defense sectors.
Impact on Boeing’s Future and Debt Reduction
This sale is part of Boeing’s ongoing strategy to reduce its overall debt, which has been a major concern for the company. Boeing’s shares rose approximately 1.5% following the announcement, signaling market confidence in the direction the company is heading. The proceeds from the sale will help bolster Boeing’s financial position, allowing it to focus on its core business segments while reducing non-core liabilities.
The sale of Jeppesen also highlights Boeing’s strategic move to divest from areas that are not directly related to its main business. Boeing has been working on shedding non-essential assets, with previous transactions including the sale of its aerospace assets to BAE Systems in 2023. Boeing’s drone business, Insitu, is also on the market, further illustrating its efforts to streamline operations and raise capital.
Jeppesen’s Role in the Aerospace Industry
Jeppesen, which employs approximately 3,900 people, is seen as a valuable asset in the aerospace industry. The company’s suite of digital aviation solutions is essential for managing the operations of airlines, fleet operators, and defense agencies. The acquisition of Jeppesen by Thoma Bravo is expected to strengthen the firm’s position in the aerospace sector, offering steady cash flow opportunities for the private equity firm.
What’s Next for Boeing?
With the Jeppesen deal set to close by the end of 2025, Boeing remains focused on its first-quarter results, which are set to be reported on Wednesday. The sale marks a significant shift for Boeing, but it’s clear that the company is determined to address its debt load and position itself for long-term growth by focusing on its core areas of expertise.
