Brazilian aircraft manufacturer Embraer and U.S. aviation giant Boeing on Thursday announced a Memorandum of Understanding aimed at creating a joint venture in the area of commercial jets. The companies said the MOU was preliminary, with final creation of the joint venture subject to additional negotiations and approval by shareholders and government regulators. Under the proposed deal, Boeing would pay Embraer shareholders $3.8 billion for an 80% stake in the joint venture, with Embraer holding 20%. The Brazilian government would continue to hold its traditional golden share under the new arrangement. The joint venture would manufacture and service only commercial jets. Embraer would retain its current military aviation and corporate jet divisions separately. The MOU has been long awaited. Earlier this year, the companies confirmed negotiations, telling investors they were closely consulting Brazil’s government.
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