Boeing-Mcdonnell Talks Break Down

Talks aimed at The Boeing Co.’s purchase of the McDonnell Douglas Corp. apparently have broken down with the two aerospace giants unable to agree on price or who would lead the company.

The deal, which could have cost Boeing $12 billion or more, would have created a powerful global leader in the industry with more than $35 billion in sales and 185,000 employees.

The breakdown means continued heavy competition to book orders from airlines worldwide. Last year, McDonnell Douglas launched its MD-95, a model that competes against Boeing’s new 737 models.

The Wall Street Journal reported Tuesday that despite a formidable team of investment and legal advisers assembled by both sides, the companies could not agree.

“For the time being, it appears that the issue is dead, but there still could be some spinoffs or other mergers of separate divisions,” said Paul Nisbet, an aerospace analyst in Providence, R.I.

McDonnell Douglas reportedly rejected early overtures by Boeing but later entered the talks.The Journal reported that a major sticking point arose over the amount of money McDonnell Douglas executives wanted for stepping aside.