By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Amidst rumors that Brazil’s aircraft manufacturer, Embraer, was being sold to Boeing, Brazilian authorities are scrambling to dissipate fears among both Brazilians and foreign partners who have contract with the multi-million-dollar company of a takeover.

Brazil,Brazil's Defense Minister, Raul Jungmann, during meeting with Saab executives in Brasilia,
Brazil’s Defense Minister, Raul Jungmann, during meeting with Saab executives in Brasilia, photo by Tereza Sobreira/Ministry of Defense.

“Embraer is symbolic for the country, more or less like Petrobras,” Brazil’s President Michel Temer stated in an interview to business daily Valor Economico published on Monday.

“The basic idea is this: no loss of control of Embraer either by the direct route or by the indirect route,” reiterated the president assuring that control of the company will continue in the hands of the federal government.

According to analysts, the Brazilian government has tentatively agreed on selling some of its shares in the company, but is unwilling to give up what is known as the ‘golden share’, which gives the Brazilian government veto power over strategic decisions about Embraer’s defense operations.

On Thursday Brazil’s Defense Minister Raul Jungmann said that the transfer of control of Embraer to Boeing is not on the negotiating table.

“We have the concern and contractual commitment to maintain control and confidentiality in technology transfer developed by Saab and jointly (with Embraer),” said Jungmann to representatives of the Swedish company Saab, which is a partner in the development of the Gripen NG fighter with Embraer.

During the meeting with Saab president, Hakan Buskhe, Minister Jungmann assured Swedish officials that any advancement in negotiations between the Brazilian and U.S. manufacturers would be relayed to the Swedish partners first hand.

“If the Embraer-Boeing partnership occurs, we will have to build safeguards that will need to be approved by Saab,” said the minister to journalists after the meeting.

These safeguards, according to officials include state of the art technology transferred by Saab to Embraer. “It is not acceptable for a technology developed through one Embraer partnership be given to another and vice versa,” added Jungmann.

The Swedish executive also spoke to journalists after the meeting, stating that he came to Brazil to see for himself the progress of negotiations between Embraer and Boeing and was satisfied that the current discussions between the Brazilian and U.S. companies would not hurt Saab. “There is no interest in ending the partnership with Brazil,” concluded the executive.

An Embraer-Boeing merger discussions began after Bombardier and Airbus announced a partnership in October.

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