Thursday, 5 July 2018

Boeing strikes aircraft deal with Brazil's Embraer



Boeing has agreed a deal that will give it control of Embraer's commercial jet business.

 
The proposed joint venture will give the US aerospace giant a significant stake in the market for smaller passenger planes.


Boeing has been courting Brazil's Embraer for some time.


The need for a deal has recently become more pressing since its European rival, Airbus, took control of Bombardier's C-Series regional jet programme.


Its deal with the Canadian company had threatened to give Airbus a significant advantage in the global marketplace.
The agreement, which values Embraer's commercial aircraft operations at $4.75bn, will restore parity between Boeing and Airbus.


Under the proposed deal, Embraer's commercial business will be placed in a new joint venture, with Boeing holding an 80% stake worth $3.8bn (£2.9bn).


Embraer is a Brazilian industrial champion and a major manufacturer of military systems.


News of the deal sent its shares down more than 10% in Sao Paulo on Thursday. Some investors had hoped Embraer's share of the joint venture would be higher than 20%.


Dennis Muilenburg, Boeing chief executive, said: "By forging this strategic partnership, we will be ideally positioned to generate significant value for both companies' customers, employees and shareholders - and for Brazil and the US."


Boeing said the deal is expected to close by the end of 2019 pending the necessary approvals.




BBC       News.