Boeing Finalizes Deal With Embraer for $4.2 Billion

Dec 17, 2018

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Boeing has finalized a deal to buy a majority stake in Brazilian plane maker Embraer’s commercial operations for $4.2 billion, the companies announced on Monday.

Embraer manufactures workhorse regional jets like the E-175 and E-190. According to the deal, Chicago-based Boeing will buy an 80% stake of Embraer’s commercial aircraft and services and take over operational and management control of those sectors. Embraer will keep the remaining 20% stake, as well as consent rights for some decisions, which would include moving any of the operations from Brazil.

Plans for the joint venture were originally announced in July, along with some of the terms of the agreement. Monday was the first time the terms — including the price tag — had been finalized by both companies. Boeing’s payment of $4.2 billion for an 80% stake values Embraer’s total commercial division at $5.26 billion. That’s 11% more expensive than the total division’s valuation when the plans were first announced, which was estimated at $4.75 billion.

Embraer’s main competitor, Canadian plane builder Bombardier, struck a similar deal earlier this year with Airbus, selling off its C-Series program to the Boeing rival.

The deal still needs approval from the Brazilian government, though the country’s new president Jair Bolsonaro has reportedly said he would be “OK” with a joint venture between the two aircraft manufacturers, Reuters reported back in October. After getting the official go-ahead from the government, the agreement will need approval from shareholders and other regulators.

Assuming the approvals come in a timely manner, Boeing said in its announcement, the deal is expected to close by the end of 2019.

Featured image by ERIC PIERMONT/AFP/Getty Images.

Delta SkyMiles® Platinum American Express Card

Earn 90,000 bonus miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new card in the first three months of card membership. Offer ends 11/10/2021.

With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.

Apply Now
More Things to Know
  • Limited Time Offer: Earn 90,000 Bonus Miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new Card in your first 3 months. Offer expires 11/10/2021.
  • Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
  • Earn 3X Miles on Delta purchases and purchases made directly with hotels.
  • Earn 2X Miles at restaurants worldwide, including takeout and delivery and at U.S. supermarkets.
  • Earn 1X Miles on all other eligible purchases.
  • Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. *Payment of the government imposed taxes and fees of no more than $75 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
  • Enjoy your first checked bag free on Delta flights.
  • Fee Credit for Global Entry or TSA Pre✓®.
  • Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
  • No Foreign Transaction Fees.
  • $250 Annual Fee.
  • Terms Apply.
  • See Rates & Fees
Regular APR
15.74%-24.74% Variable
Annual Fee
$250
Balance Transfer Fee
N/A
Recommended Credit
Excellent/Good
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.