Embraer has accused Boeing of “wrongfully” terminating the Master Transaction Agreement (MTA) to establish a strategic partnership, and said the company failed to cough up $4.2 billion purchase price.
“Embraer announced today that it is in receipt of Boeing's notice of termination of MTA with Embraer. Embraer 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 $4.2 billion purchase price,” the company said.
“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," the Brazilian company added.
Earlier today, Boeing ended talks that would have given it an 80% stake in Embraer's commercial jet unit. Boeing said Embraer did not satisfy conditions under the agreement, which expired on April 24, but the Chicago-based company declined to go into specifics.
The parties had planned to create a joint venture comprising Embraer's commercial aviation business and a second joint venture to develop new markets for the C-390 Millennium medium airlift and air mobility aircraft.
Boeing and Embraer will maintain their existing Master Teaming Agreement, originally signed in 2012 and expanded in 2016, to jointly market and support the C-390 Millennium military aircraft.
The planned partnership between Boeing and Embraer had received unconditional approval from all necessary regulatory authorities, with the exception of the European Commission.
“Boeing has worked diligently over more than two years to finalize its transaction with Embraer. Over the past several months, we had productive but ultimately unsuccessful negotiations about unsatisfied MTA conditions. We all aimed to resolve those by the initial termination date, but it didn't happen," said Marc Allen, president of Embraer Partnership & Group Operations.
"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,” Allen added.