Five years ago, Wisk Aero sued Archer Aviation Inc. (NYSE:ACHR) for allegedly stealing its trade secrets. On August 10, Archer agreed to buy Wisk entirely, along with two other The Boeing Company (NYSE:BA) subsidiaries, in a deal that gives the aerospace giant a roughly 20% interest in the electric-aircraft company it previously accused of corporate theft. Archer's stock jumped by about 20% following the announcement.

The Companies' History

Wisk sued Archer back in 2021, alleging that the younger company stole its autonomous-flight trade secrets and breached on its patents. The two reached an agreement in August 2023, with a unique twist: The Boeing Company (NYSE:BA) invested in Archer Aviation Inc. (NYSE:ACHR), and the companies formed an autonomous-flight relationship, with Wisk serving as Archer's exclusive autonomy provider for subsequent aircraft.

That collaboration has now turned into a complete acquisition. Under the definitive agreement, Archer Aviation Inc. (NYSE:ACHR) will buy Wisk Aero, SkyGrid, a digital airspace and air-traffic-management software firm, and Insitu, a drone producer, in an all-stock transaction.

The Terms of the Agreement

The Boeing Company (NYSE:BA) will acquire freshly issued ACHR Class A shares equal to 19.75% of Archer's outstanding shares immediately before to closing, leaving Boeing with about 16.5% in stakes once the transaction closes, making it Archer's largest outside stakeholder. The Boeing Company (NYSE:BA) has also agreed to spend up to $55 million in an upcoming Archer investment round, and will obtain warrants to buy up to $200 million additional Archer stock in the future. In exchange, the companies have signed a cross-licensing agreement that allows Boeing to continue using Wisk's fundamental autonomous flight systems for its own commercial and defense programs, a detail experts have linked to Boeing's ultimate successor to the 737.

Why Archer Wants It

For Archer Aviation Inc. (NYSE:ACHR), the deal is less about eliminating a competitor than about expanding. The acquisition includes a defense firm with an annual revenue of more than $200 million across 35 nations, as well as Wisk's six generations of eVTOL aircraft designs and over 1,700 completed test flights. Archer describes the combined operation as a "end-to-end physical AI platform for aerospace and defense."

Why Boeing Is Selling

The transaction continues a divestiture pattern established by CEO Kelly Ortberg, who came office in August 2024 with a directive to reduce Boeing's sprawling portfolio. Last year, the company sold Jeppesen, a flight planning service, and related digital aviation units to private equity firm Thoma Bravo for $10.55 billion. Offloading Wisk, SkyGrid, and Insitu allows The Boeing Company (NYSE:BA) to shift its focus away from non-core businesses.