UPDATE 1-Spirit Aerosystems starts layoffs amid bid talk

Thu Jul 25, 2013 12:51pm EDT
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July 25 (Reuters) - 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 $25.86.

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.   Continued...