Boeing Settles Embraer JV Dispute with $150 Million Payment
Boeing has agreed to pay USD150 million to Embraer, settling an arbitration dispute over a failed commercial aviation joint venture and a C-390 aircraft partnership. Embraer confirmed the settlement in a notice to the United States Securities and Exchange Commission on September 16, officially concluding negotiations between the two aerospace giants.
The dispute originated in mid-2018 when Embraer, the Brazilian aircraft manufacturer, announced plans to sell 80% of its commercial aviation business to Boeing. At the time, the deal valued Embraer’s commercial arm at approximately USD5.25 billion. A master transaction agreement was signed in early 2019, which included a separate joint venture for marketing the C-390 Millennium, a military cargo aircraft.
However, in April 2020, Boeing terminated the agreements, citing Embraer’s failure to meet certain conditions required to finalize the deal. Embraer disputed this, claiming Boeing backed out due to its well-known financial struggles.
The recent filing reveals that both parties reached a collar agreement, a financial arrangement designed to limit potential losses and cap possible gains. The settlement of USD150 million is notably lower than earlier reports, which had suggested Boeing might pay up to USD300 million.
A Boeing spokesperson expressed satisfaction with the outcome, stating, “We’re pleased to have concluded the arbitration process with Embraer,” according to aviation news outlet ch-aviation. This settlement brings an end to the years-long legal conflict between the two companies.
Related news: https://airguide.info/?s=boeing, https://airguide.info/?s=Embraer
Sources: AirGuide Business airguide.info, bing.com, boeing.com, U.S. Securities and Exchange Commission