Embraer and Boeing have approved the terms of a strategic partnership comprising joint ventures in commercial aircraft and services and in the promotion of the Brazilian firm's KC-390 airlifter. The proposed tieup was initially announced in July.

The move follows Airbus' acquisition of majority ownership of the Bombardier CSeries programme, finalised in June, leading to adoption of the new Airbus A220 designation.

Boeing will hold an 80% stake in the joint venture comprising the commercial aircraft and services operations of Embraer, while Embraer will hold the remaining 20%. The transaction remains subject to approval by the Government of Brazil, after which Embraer and Boeing intend to execute definitive transaction documents.

The closing of the transaction will then be subject to shareholder and regulatory approvals and customary closing conditions.

Under the terms of the proposed partnership, Boeing will acquire an 80% ownership stake in the joint venture for $4.2bn. The JV will be led by Brazil-based management, including a president and chief executive officer.

Boeing will have operational and management control of the new company, which will report directly to Boeing CEO Dennis Muilenburg. Embraer will retain consent rights for certain strategic decisions, such as transfer of operations from Brazil.

The second joint venture aims to promote and develop new markets for the multi-mission medium airlift KC-390. Under the terms of this proposed partnership, Embraer will own a 51% stake in the joint venture, with Boeing owning the remaining 49%. The first series production KC-390 made its maiden flight in October.

Assuming the requisite approvals are received in a timely manner, the transaction is intended to close by the end of 2019.