Boeing and Embraer have ended arbitration talks regarding the former's termination of a commercial aircraft joint venture agreement and a C-390 aircraft partnership, with Boeing agreeing to pay USD150 million. Embraer filed a short notice to the United States Securities and Exchange Commission on September 16 confirming the payment and conclusion of negotiations.
The matter dates back to mid-2018 when the Brazilian aerospace manufacturer announced it would sell 80% of its commercial aviation business to Boeing. Embraer's commercial aviation arm then had a valuation of around USD5.25 billion. In early 2019, the master transaction agreement was signed and included a joint venture for marketing the C-390 Millenium military cargo aircraft.
In April 2020, Boeing terminated the agreements, claiming Embraer had failed to meet conditions for closing the deal. Embraer argued that Boeing had axed the arrangement because of its well-publicised financial problems.
The week's filing said the two sides had reached a collar agreement, a type of deal used to limit the potential loss while also capping the potential gain. The settlement amount was less than the widely reported expectations of USD300 million.
"We're pleased to have concluded the arbitration process with Embraer," a Boeing spokesperson told ch-aviation.
