The proposed strategic partnership between Boeing and Embraer has been approved by Embraer’s shareholders during an extraordinary general shareholders meeting, held at the company’s headquarters in Brazil.
During this meeting, 96.8 percent of votes were in favour of the transaction, with participation of approximately 67 percent of all outstanding shares. Shareholders approved the proposal that will establish a joint venture made up of the commercial aircraft and services operations of Embraer.
Paulo Silva, president and chief executive officer of Embraer, said: “This ground-breaking partnership will position both companies to deliver a stronger value proposition for our customers and other stakeholders, creating more opportunities for our employees.”
Boeing will hold 80 percent ownership of the new company, and Embraer will hold the remaining 20 percent. The transaction values 100 percent of Embraer’s commercial aircraft operations at $5.26 billion, with a value of $4.2 billion for Boeing’s 80 percent ownership stake in the joint venture.
Embraer shareholders also agreed to a joint venture to prove and develop new markets for the multi-mission medium airlift KC-390. Under the terms of this proposed partnership, Embraer will own a 51 percent stake in the joint venture, with Boeing owning the remaining 49 percent.
Nelson Salgado, executive vice president of finance and investor relations for Embraer, said: “Our shareholders have recognized the benefits of partnering with Boeing in commercial aviation and the promotion of the multi-mission airlift KC-390, as well as understanding the opportunities that exist in the executive aviation and defence business.
Embraer will continue to operate the commercial aviation business and the KC-390 program independently until the closing of the transaction, which is subject to obtaining regulatory approvals and satisfaction of other customary closing conditions. Boeing and Embraer hope to achieve this by the end of 2019.
Feature image by Aerospace Manufacturing and Design