New York, Apr 25 (efe-epa).- Boeing announced Saturday that it was dropping plans for an enhanced partnership with Brazilian aircraft maker Embraer that would have seen the troubled US giant taking an 80 percent stake in the South American firm’s commercial aviation business.
“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 (Master Transaction Agreement) conditions,” Marc Allen, head of Embraer Partnership & Group Operations for the Chicago-based manufacturer.
“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,” he said.
Under the terms of the agreement negotiated in 2018, the initial termination date was Friday.
After April 24 came and went without a resolution of the remaining issues, “Boeing exercised its rights to terminate after Embraer did not satisfy the necessary conditions,” the US company said.
The prospective deal had already received approval from all relevant regulatory authorities except the European Commission, which was still evaluating the implications of a tie-up between Boeing, the world’s largest maker of commercial planes, and Embraer, the third-biggest.
Embraer’s strength is in the category of regional jets, planes with 90-120 seats, a category currently dominated by Boeing’s archrival, Airbus.
Besides Boeing’s $4.2 billion takeover of Embraer’s commercial division, the 2018 MTA envisioned the creation of a second joint venture to cultivate new markets for the Brazilian company’s C-390 Millennium medium airlift and air mobility aircraft.
The two firms “will maintain their existing Master Teaming Agreement, originally signed in 2012 and expanded in 2016, to jointly market and support the C-390 Millennium,” Boeing said.
Boeing finds itself in a much worse position now than in 2018. Already reeling from having to take its 737-Max jetliner out of service after a pair of deadly crashes, the firm must now cope with a near-shutdown of commercial aviation thanks to the Covid-19 pandemic. EFE nqs/dr