[ad_1]
SAO PAULO – The rating agency S & P Global Rating placed the Embraer rating – currently at "BBB" – in negative observation, as a result of the government's approval of the strategic partnership between the company and Boeing.
American Boeing will acquire 80% of Embraer's commercial aviation segment and form a joint venture named NewCo.
The value of the joint venture was set at US $ 5.26 billion and the resources Embraer will receive through the transaction (after taxes and separation costs) amount to US $ 3.1 billion.
Although the deal offers better leverage indicators and generates dividends with the creation of the joint venture, S & P expresses concern about the "fair share".
"We see a potential impact of more than one step on Embraer's credit quality because the separation will significantly weaken the company's business profile," the agency said. S & P explains that this weakening stems from the fact that Embraer will have a smaller scale and a greater concentration of customers in the defense sector. In addition, the operation may result in greater profit volatility and the need to improve profitability in the executive aviation unit.
The agency currently estimates a profit margin before interest, taxes, depreciation and amortization (EBITDA, in English) of the executive division of Embraer, nearly 5% against 15% of the business unit.
S & P announces that it will make a decision regarding the observation of the negative rating – whether it retrogrades or not – once the other approvals and when to get more details on the credit profile of the joint venture that will be formed.
[ad_2]
Source link
