Embraer shares rose 4.44% to R$104.04 by 12:25 p.m. on Tuesday, after reaching R$104.70 earlier in the session. The gain contrasted with a 1.7% decline in Brazil’s Ibovespa index. The B3 exchange had been closed on Monday for the All Souls’ Day holiday.
The move followed an announcement by Greece’s Ministry of National Defence that it had signed an agreement to acquire three KC-390 Millennium aircraft, with an option for three additional units. The purchase is being arranged through a government-to-government agreement between Greece and Portugal.
BTG Pactual analysts said the announcement further strengthens the KC-390’s international position. Although the contract value was not disclosed, they said it supports the aircraft’s competitiveness and their expectations for growth and expanding margins in Embraer’s defence business.
Greece will become the ninth country in Europe and the eighth NATO member to select the KC-390. Under the arrangement, Portugal is expected to purchase the additional aircraft and transfer them to Greece. The source reported that Portugal’s profit on the transaction is equivalent to R$180 million at current values, within a deal worth R$3.6 billion. The value of Greece’s direct agreement with Embraer was not disclosed.
Sources: Folha Mercado.