Boeing wooing Embraer with commercial jet venture: sources
Chicago
BOEING Co is wooing Embraer SA with a plan to form a commercial jet venture instead of an outright acquisition, people familiar with the talks said.
The two planemakers have made good progress on the framework for a deal, but hurdles remain and the final terms are still being hammered out, said one of the people, who asked not to be named because the negotiations are private.
While another person said Boeing presented a plan on Thursday, Embraer said on Friday that it had yet to receive a proposal - while confirming that talks were ongoing and possibilities include the creation of new companies.
It is not clear whether a jointly operated company would encompass all or part of Embraer's commercial aircraft unit. Embraer's military business would be excluded, potentially resolving the Brazilian government's concerns over national interests.
Brazil holds a so-called "golden share" in Embraer that gives it the power to veto the transaction. A tie-up would extend a tectonic shift in the commercial plane industry that was triggered in October when Airbus SE agreed to take control of Bombardier Inc's C Series jet - a competitor to an Embraer jet due to debut this year.
Boeing recently lost a bid to block the C Series from the US market, when the US International Trade Commission ruled against the Chicago-based planemaker.
Analysts had expected the companies to focus on forging a joint venture after an earlier Boeing bid to take control of Embraer, one of Brazil's most prominent manufacturers, drew swift opposition from Brazilian President Michel Temer. "All partnerships are welcome, what is not under consideration is transferring Embraer's control to another company," Mr Temer said at the time. BLOOMBERG
