(Bloomberg) -- Embraer SA shares rose as much as 10 percent to 23.09 reais on Friday, the most intraday in more than a year, after the Brazilian government announced it won’t veto the deal with Boeing Co., giving its approval for two joint ventures.
President Jair Bolsonaro said yesterday on Twitter that it became clear that the country’s interests and sovereignty were safeguarded. Also, the Union doesn’t oppose the process moving forward, Bolsonaro wrote after a meeting with representatives for Ministries of Defense, Science, Foreign Affairs and Economy.
In a joint statement, both companies said the deal conclusion will now be subject to shareholder and regulatory approvals. The completion of the transaction is expected by the end of 2019, they said. Brazil’s antitrust agency expects to start reviewing the deal over the next weeks, agency head Alexandre Barreto told Bloomberg.
BTG Pactual reiterated its buy rating for Embraer’s American depositary receipts after the Brazilian government’s decision. The bank said the firm’s ADR is worth at least $30 --assuming the deal’s conclusion.
"Although odds of approval were already considered high, this is still positive news as it is a major milestone," BTG Pactual analysts Renato Mimica and Samuel Alves wrote in note from Jan. 11.
(Adds comments from Brazil’s antitrust agency head in third paragraph.)
--With assistance from Mario Sergio Lima and Raymond Colitt.
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