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Boeing, Embraer working to clear hurdles to a deal


Added 01-05-18 05:02:02pm EST - “The issue: assuring Brazil's leadership of the sovereignty of Embraer's defense business.” - Cnbc.com

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Posted By TheNewsCommenter: From Cnbc.com: “Boeing, Embraer working to clear hurdles to a deal”. Below is an excerpt from the article.

Despite reports government leaders in Brazil are opposed to signing off on a deal that would allow Boeing to buy jet maker Embraer, sources tell CNBC a deal is still possible. In fact, those familiar with the situation say Boeing executives are in the midst of putting together a plan to address the concerns of Brazilian leaders while still allowing a potential deal to take place.

Boeing and Embraer need Brazil's blessing before a sale can be completed. That's because the Brazilian government holds "golden shares" in Embraer giving it the right to veto strategic decisions at Embraer.

Boeing executives tell CNBC they have no comment on discussions with Embraer. In late December the aerospace giant and Embraer acknowledged they were in talks.

What's the next step in those negotiations? Sources tell CNBC that Boeing executives hope to meet with government officials in Brazil sometime in the next few weeks. While nothing has been scheduled, those close to the matter say Boeing is hopeful it can structure the deal to assuage the concerns Brazil has about Embraer's defense operations.

One possibility: structuring Embraer's military business to ensure the sovereignty concerns of Brazil. In the past, Boeing has set up military subsidiaries in Australia and the United Kingdom to meet specific concerns of those governments.

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