Brazilian planemaker Embraer SA has been thrust into an uncertain future with no immediate plan B, while not ruling out seeking a bailout after Boeing Co jettisoned a $4.2 billion commercial aerospace tie-up amid the coronavirus crisis.
FILE PHOTO: Air Astana Embraer E190-E2 aircraft with a snow leopard livery is seen at Almaty International Airport, Kazakhstan January 21, 2020. REUTERS/Pavel Mikheyev
“For Embraer, it could be very damaging,” said Teal Group consultant Richard Aboulafia, noting it was the only significant independent jetmaker. The former state-owned company has not asked for a bailout but says it is open to “complementary” sources of financing.Embraer “will need strong government support to recover the expenses and recover from the economic crisis caused by coronavirus,” said Aurelio Valporto, who heads minority shareholder group Abradin and opposed the deal.First, it would pay $1.6 billion in dividends from the sale.
On the positive side, analysts expect demand for small jets like the A220 or Embraer’s E2 to lead any future rebound.In Brazil, alarm bells rang when Boeing lawyers began quizzing Brazilian counterparts on paperwork in recent weeks.
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