U.S. aircraft maker Boeing announced on Saturday that it has canceled a $ 4.2 billion deal to take over Embraer’s commercial aircraft division, giving up years of work for an acquisition that, according to the Brazilian aircraft maker, would have a transforming effect.
The Boeing announcement confirmed information previously published by Reuters, according to which the agreement is close to failure as the two companies approach a deadline.
According to Boeing, Embraer failed to meet certain conditions for the deal to continue but did not specify what it was. The April 24 deadline was included in the agreement since the beginning of last year. But obstacles to competition law have forced the two companies to try to set a new deadline.
Embraer’s representatives declined to comment.
In July 2018, Boeing agreed to take an 80% stake in the commercial aircraft division of the Brazilian company Embraer, to compete directly with Airbus on the medium-sized aircraft market, with up to 150 seats.
At the time, Embraer argued that the agreement was crucial to the company’s future.
“Given the current state of the world aviation market, it can be seen that the agreement with Boeing is not only beneficial for Embraer but also fundamental to the company’s survival,” Embraer lawyers said last year in response to a lawsuit.
Embraer also made great efforts to separate the commercial aircraft division from the group, to prepare it for takeover by Boeing. Earlier this year, the company incurred expenses to send all employees on paid two-week leave to manage preparations.