McDonnell’s Taiwan Deal Delayed : Aerospace: The company says its would-be partners need more time to complete a financial examination.

McDonnell Douglas said Tuesday that it will not meet its previously announced target date of Jan. 31 for completing the proposed $2-billion sale of 40% of its commercial aircraft business to a Taiwanese group.

Company spokesman Michael Burch said the delay has resulted because its Taiwanese partners will take longer than expected to complete a financial examination, known as due diligence, of Douglas Aircraft.

Burch said the deal has not run into any obstacles or setbacks that would jeopardize it. A number of objections to the deal have been raised in Taiwan, but those are not unusual given the size of the deal, Burch said.

Aerospace analyst Wolfgang Demisch of UBS Securities said Tuesday that it could take McDonnell until the end of June to complete the deal because of myriad details that must be worked out.

“When was the last time you saw somebody make a $2-billion investment without kicking the tires?” Demisch said.

An evaluation team arrived from Taiwan at Douglas’ Long Beach facility Tuesday.

It remains unclear whether the delay in the Taiwan Aerospace deal will affect the formal launch of the next-generation MD-12 jetliner.

The aircraft’s fuselage and wings are supposed to be built in Taiwan by the new joint venture company that will be owned jointly by Taiwan Aerospace and Douglas.

Demisch said he had some questions about the timetable for launching the MD-12 and about the ability of Taiwan Aerospace to build parts for the jetliner as quickly as the current schedule demands.

He noted that McDonnell’s goal to have the aircraft in service by 1996 would require the aircraft to be in test flight by 1995, substantial production by 1994 and tooling development by 1993.

“Here it is 1992 and they don’t have a plant yet in Taiwan,” Demisch said.

Separately, Rep. Barbara Boxer (D-Greenbrae) said Tuesday that she will meet with labor and management officials from McDonnell next week as the first step in finding alternatives to the Taiwan deal.

She raised the possibility of providing an interest-free loan pool for distressed industry in need of capital, which would be repaid over a 30-year period.