Minutes ago, Boeing announced its partnership with Embraer was cancelled.
The joint venture between Boeing and the Brazilian regional jet manufacturer Embraer has officially been cancelled after Embraer “did not satisfy the necessary conditions”.
This deal between the two manufacturers would’ve had Boeing acquiring an 80% stake in Embraer worth $4.2 billion while Embraer retained the remaining 20%.
This acquisition would’ve renamed Embraer as “Boeing Brasil Commercial”.
Marc Allen, president of Embraer Partnership & Group Operations:
“Boeing has worked diligently over more than two years to finalize its transaction with Embraer. Over the past several months, we had productive but ultimately unsuccessful negotiations about unsatisfied MTA conditions. We all aimed to resolve those by the initial termination date, but it didn’t happen. It is deeply disappointing. But we have reached a point where continued negotiation within the framework of the MTA is not going to resolve the outstanding issues.”
The partnership between Boeing and Embraer already received unconditional approval from all necessary regulatory authorities, except from the European Commission.
This deal was intended to compete the new Airbus/Bombardier partnership where Airbus recently acquired the C-Series/A220 program.
Embraer now seeks damages against Boeing:https://www.flightglobal.com/aerospace/embraer-to-seek-damages-as-it-accuses-boeing-of-sabotaging-merger/
Not great for both companies as the proposed deal would’ve been able to help compete against its competitors. Embraer spent $120.8 million alone working on preparing for the new partnership.