The deal could potential the creation of a new company controlled by Boeing which will focus on commercial aviation while Embraer would stick to creating business jets and aircrafts for defense.
As per a report by Brazil’s largest financial newspaper Valor Economico, Paulo Souza e Silva CEO of Embraer SA’s has stated the planemaker is in final stage talks with Boeing for combining operations.
He declined to divulge any further details saying, the negotiations are “complex.”
The two planemakers have been discussing this transaction for months now; the idea is to create a new company controlled by Boeing which would focus on creating commercial aviation while Embraer would stick to business jets and defense
Defending the potential deal from criticism from lawmakers at a congressional hearing on Wednesday, a Brazilian air force official suggested the government’s concerns vis-a-vis the deal have subsided.
As per Air Force Commander Lt Brig Nivaldo Luiz Rossato, the potential deal would “preserve national sovereignty,” by keeping Brazilian defense programs out of the hands of the U.S. company.
Earlier this week, Embraer had said, any deal would need the approval of the Brazillian government as well as regulators.
Calling the deal as a “crime against the homeland,” Carlos Zarattini a Congressman from the Workers Party said, how can the Brazillian government, which can veto the deal, allow Boeing to take control over the country’s top jewel: its aerospace industry.
Countering this line of argument, Air Force Commander Lt Brig Nivaldo Luiz Rossato stated the U.S.-Brazil partnership could end up saving jobs at Embraer.
With the news reaching the market, Embraer’s shares rose by nearly 4% midst investor speculation that a positive announcement could be made soon.