In a statement, the US manufacturer announced that Embraer had not satisfied the necessary conditions for the deal to proceed on April 24th.
Boeing explained that under the Master Transaction Agreement (MTA) April 24th was the initial termination date; if certain conditions were not met, this date could be extended. Instead, Boeing decided to terminate the MTA.
The MTA between Embraer and Boeing was to establish a new level of strategic partnership. The two parties had previously agreed to create a joint venture called Boeing Brasil; including Embraers commercial aviation business and intending to develop new markets for the KC-390 military aircraft.
“Boeing has worked diligently over more than two years to finalise its transaction with Embraer. Over the past several months, we had productive but ultimately unsuccessful negotiations about unsatisfied MTA conditions.”said Marc Allen, president of Embraer Partnership & Group Operations.
“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.”said Marc Allen, president of Embraer Partnership & Group Operations.
Embraer Hits Back at Boeing
Embraer issued a statement that believes strongly that Boeing has wrongfully terminated the MTA, that it has manufactured false claims as a pretext to seek to avoid its commitments to close the transaction and pay Embraer the US$4.2 billion purchase price.
We believe Boeing has engaged in a systematic pattern of delay and repeated violations of the MTA, because of its unwillingness to complete the transaction in light of its own financial condition and 737 MAX and other business and reputational problems.Embraer Statement
Embraer believes it is in full compliance with its obligations under the MTA. “It will pursue all remedies against Boeing for the damages incurred by Embraer as a result of Boeing’s wrongful termination and violation of the MTA.” from statement by Embraer.
The planned partnership between Boeing and Embraer had received unconditional approval from all necessary regulatory authorities, with the exception of the European Commission.
Article Source: Boeing, Embraer