Boeing-Embraer marriage finalisation put off to 2020 as EU performs antitrust investigation
The marriage of Boeing’s and Embraer’s commercial aircraft operations are now expected to close in 2020 as the two companies wait for final regulatory approvals. Boeing and Embraer said they had received approval from US regulators for the deal, under which Boeing will acquire 80 percent of Embraer’s commercial jet division for US$4.75 billion. The companies had said previously they hoped to close the deal by the end of this year.
The two companies attributed the delay to a planned assessment by the European Commission – a so-called Phase II assessment – which is an antitrust investigation. “Based on this development, however, the companies now expect the transaction to close in early 2020,” Boeing said in a statement.
The deal between Boeing and Embraer is the answer to a similar one done by Airbus in which the European plan maker bought a controlling stake in Canada’s Bombardier, which makes commercial plans that compete directly with Embraer.
Boeing-Embraer are also preparing to launch a joint venture to promote and develop markets for the multi-mission medium airlift KC-390 cargo plane. Under the terms of the proposed partnership, Embraer will own a 51 percent stake in the joint venture and Boeing will own the remaining 49 percent. Two KC-390 milestones were recently achieved by Embraer: the first KC-390 was delivered to the Brazilian Air Force, and the first international purchase was announced by Portugal.