Embraer negotiating $600 million bank financing for exports By Reuters

Embraer negotiating $600 million bank financing for exports By Reuters

© Reuters. FILE PHOTO: The logo of Brazilian planemaker Embraer SA is seen at the company’s headquarters in Sao Jose dos Campos

RIO DE JANEIRO (Reuters) – Brazilian planemaker Embraer SA (SA:), the world’s third largest commercial jet builder, should obtain $600 million in credit lines from Brazil’s state development bank BNDES and private banks in June, government sources said on Sunday.

The loans will finance production to meet demand for passenger planes and executive jets, they said speaking on condition they were not named.

A spokesman for Embraer confirmed that the company is in talks on financing proposals from the BNDES and private bank in Brazil and abroad to aimed mainly at providing working capital to cover plane exports.

Embraer said it has firm orders for the years ahead worth $16 billion on March 31.

“This shows how sound and balanced the company is in the midst of the crisis hitting the aviation sector,” one of the sources said.

“No one knows what the future holds in store for commercial aviation, but with less people flying it could well be an era of smaller planes and private aircraft,” the source added, pointing to Embraer’s forte as a leading maker of regional jets.

The Brazilian government has been negotiating a financial bailout for Brazil’s airlines to help them cope with the dramatic loss of business during the coronavirus pandemic.

The bailout involving BNDES should be decided by the start of July, and Embraer could receive some $400 million of that aid package that is expected to include bond issues, the sources said.

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