Embraer is moving closer to divesting its air taxi business Eve Urban Air Mobility (UAM), saying it expects to close the deal on May 6, pending shareholder approval.
The deal, which gives Eve a pre-money valuation of around US$2.2 billion, has been in the works at least since June previous year when Zanite confirmed it was in negotiations with Eve.
Embraer said it signed an agreement to sell Eve to Zanite in exchange for 220 million Zanite shares, valued at $10 per share and equating to a total value of $2.2 billion.
Eve parent company Embraer is contributing $175 million, with Zanite’s sponsor kicking in $25 million and the remaining $105 million coming from a consortium of financial and strategic investors including Azorra Aviation, BAE Systems, Banco Bradesco, Falko Regional Aircraft, Republic Airways, Rolls-Royce, and SkyWest.
If the merger is successful, Zanite will change its name to Eve Holding and will be listed on the New York Stock Exchange under the ticker symbol EVEX. Embraer will become a majority shareholder, around 80% of the combined company.
Eve is developing an electric vertical take-off and landing (eVTOL) aircraft that will carry four passengers and have (100km) of range. It aims to achieve type certification and service entry in 2025 or 2026, according to company materials.
Eve said the proceeds from the transaction will be used to develop and commercialize its UAM ecosystem, which includes designing and producing eVTOL aircraft, as well as providing service and support, fleet operations, and urban air traffic management solutions.
The company has secured a total of 1,735 conditional pre-orders of its eVTOL aircraft from 17 launch customers, worth about $5.2 billion, and plans to launch its UAM network in various regions by 2026.
Last year Eve and Fahari Aviation – the Unmanned aircraft systems (UAS) division of Kenya Airways that promotes safe and secure UAS usage in the region – signed an MOU to develop operational models for the wide accessibility of Urban Air Mobility to support Fahari Aviation’s key markets.
Eve will help in establishing Fahari Aviation in its UAM network and collaborate on the required Urban Air Traffic Management (UATM) procedures and UAM operating environment.
This partnership will also allow Fahari Aviation to support Eve’s aircraft and product development process which will help guide the integration of UAM with Kenya Airways’ overall operations.