Embraer extends US $1 billion credit line for five years
Embraer has extended a US $1 billion syndicated credit line, providing the company with access to financial resources at pre-negotiated rates and thereby reinforcing the Brazilian planemaker’s liquidity for the next five years. The deal is an extension of a US $650 million syndicated credit operation that was announced in October 2022.
The agreement is led by PNC Bank, Crédit Agricole, and Citibank, and includes the participation of a number of institutions including Banco do Brasil, Bank of America, BNP Paribas, Bradesco, Commerzbank, Goldman Sachs, Mizuho, JP Morgan, Morgan Stanley, MUFG, Natixis, Sumitomo Mitsui Bank Corporation, and Santander.
The deal will allows access to a revolving credit line that can be used by Embraer’s subsidiaries in the US and the Netherlands, with Embraer S.A. as its guarantor.
Embraer is the main exporter of high value-added goods in Brazil, and is now the world’s leading manufacturer of commercial jets up to 150 seats, with a strong track record in commercial and executive aviation, defence and security and agricultural aviation, including services and support. The company has delivered more than 8,000 aircraft since it was founded in 1969, and has a presence across the Americas, Africa, Asia and Europe, with industrial units, offices, service and parts distribution centres.
S&P Global Ratings raised Embraer’s rating from ‘BB+’ to a ‘BBB-‘ rating earlier this year, and said that the company had maintained a stable outlook. Higher aircraft deliveries, cost reduction, and efficiency measures have led to strong cash generation and free cash flow in 2023. Fitch Ratings also revised the company’s BB+ with a positive outlook, while Moody’s raised the rating to Ba1 and maintained a stable outlook.
Antonio Carlos Garcia, CFO of Embraer said that: “The extension of a significant syndicated credit line reinforces Embraer’s liquidity for the next five years, providing important support for our long-term strategy. Our partnership with strong and marquee financial institutions reinforces Embraer’s credit quality.”
