Speculation is rampant that Boeing plans to offer its Jeppesen subsidiary for sale as part of an effort to raise cash to offset its $58 billion debt. However, there is no indication from Boeing of whether it is offering to sell Jeppesen. During Boeing’s October 23 earnings call, Boeing CEO Kelly Ortberg shed a little light on the portfolio review concept.
“I'm not going to specifically comment on Jeppesen,” he said. “But looking at all of our activities like that, whether it's in our services business or in either [of] the core businesses, looking at what we're doing there and asking the question, does that really fit in our long-term strategy or would that property be better off somewhere else and we could get more value—we’re destroying value by holding it in The Boeing Company. So, those are the things that we'll look at as we do this portfolio review. And my guess is there'll be some things that we want to take action on. I just don't have that list to tell you right now what am I going to do.
“I want to have a good feeling internally by the end of the year as to what I want…and we've got a process underway where we do our long-range planning, which will facilitate that. Now, you know…that some of these things can be actioned quickly, some of these things are not actionable, [and] some of these things take a long time. So, it sort of depends on what the opportunities are, can things be separated, can we just stop doing work…but let's declutter our minds with some of this stuff and get our resources really focused on what's going to make a difference for us going forward, and that's the type of stuff I want to really focus on.”
Boeing purchased Jeppesen for $1.5 billion in 2000 and the amount attached to the latest speculation about selling Jeppesen suggests a value of $6 billion. Jeppesen and the services attached to it that Boeing offers have expanded significantly since 2000 and include many product offerings, including airspace optimization; crew management solutions; data solutions; developer tools; flight efficiency and sustainability; flight planning and dispatch; navigation solutions; and network operations management.
Boeing purchased and operates ForeFlight, creator of theForeFlight Mobile electronic flight bag app, separately from Jeppesen. However, there are some mentions of ForeFlight within the above Jeppesen categories. Specifically, under navigation solutions, ForeFlight Mobile EFB and ForeFlight Military Flight Bag are listed. And the flight planning and dispatch section includes ForeFlight Dispatch as one of the products.
When Boeing announced that it was buying Jeppesen from Tribune Co. in 2000, then-CEO Phil Condit said, “We've made it clear that we are transforming Boeing into a global aerospace solutions provider, and growing our aviation services business is a major part of that transformation. Jeppesen is the world's No. 1 source for flight information services, so it's a perfect fit for our aviation services portfolio. If you're a pilot almost anywhere in the world, you know Jeppesen. This is another great strategic play that brings us an enduring global brand, increases our ability to create more, better, and faster solutions for our customers, and helps us to create value through our growing services business."
Business aviation consultant Brain Foley, founder of Brian Foley and Associates, had these suggestions when asked which companies might be interested in buying Jeppesen:
"Tier 1 avionics suppliers—Each has flight planning software suites that could be vertically integrated.
Airbus—Has its own flight software suite Navblue.
Leidos—An aviation software conglomerate, formerly a Lockheed Martin division, providing services to the FAA, air navigation service providers, and airport operators.
Berkshire Hathaway—NetJets, FlightSafety owner so knows aviation. Biggest cash position ever. Value shopper and may see ailing Boeing as willing to discount."