American Boeing has signed a letter of intent with Brazilian aircraft manufacturer Embraer to establish a strategic partnership in global aviation markets.

This is stated in a press release.

According to the letter of intent, Boeing is expected to own 80 percent of the joint venture, while Embraer is expected to own 20 percent. The plan is for the joint venture to consist of Embraer's commercial aircraft and services operations that would be strategically aligned with Boeing's commercial development, production, marketing and service operations.

The deal values Embraer's commercial aircraft business at $4.75 billion.

The joint venture is expected to increase Boeing's earnings per share from 2020 and generate annual cost synergies of $150 million from the third year.

Boeing has previously wanted to buy Embraer, but the issue has been politically sensitive in Brazil, including from a defense perspective.

Brazil's Minister of Defense has previously said that Embraer's defense operations cannot be separated from the rest of the company.

Source: Nyhetsbyrån Direkt