Following the announcement that Boeing plans to buy an 80 percent stake in Embraer’s commercial aviation business and form a joint venture with Embraer, the two companies made no mention of what will happen to the Embraer Executive Jets division. But according to a statement from an Embraer spokesman, “Embraer Executive Jets will continue with Embraer.”
The announcement was in the form of a memorandum of understanding that proposed the formation of a joint venture meant to “strategically align” the companies’ commercial development, production, marketing, and lifecycle services operations.
The transaction values Embraer’s commercial aircraft operations at $4.75 billion and contemplates a value of $3.8 billion for Boeing’s 80 percent ownership stake in the joint venture.
The companies expect completion of the financial and operational details of the partnership and negotiation of transaction agreements to continue “in the coming months.” The transaction would then remain subject to shareholder and regulatory approvals, including approval from the government of Brazil. Assuming the approvals come in what the joint statement characterized as a timely manner, the companies expect the transaction to close by the end of 2019, or 12 to 18 months after execution of the definitive agreements.
During 2017, Embraer Executive Jets delivered 109 airplanes, among them the division’s 1,100th jet (a Phenom 300). Net revenues for the business jet division during 2017 reached $1.485 billion, while the company’s commercial division generated net revenues of $3.372 billion.