Plane makers Boeing and Embraer have approved terms in their proposed joint venture.
It values Boeing’s planned controlling stake in the Brazilian company at $4.2billion.
The deal will see Boeing take 80% ownership of the JV with Embraer taking the remaining 20%.
The tie-up is still subject to approval by the Brazilian government but is supported by Brazil’s president Jair Bolsonaro.
Boeing will have operational and management control and the Brazilian management will report directly to Boeing’s executive team.
They plan to complete the deal by the end of 2019 and target pre-tax cost savings of approximately $150 million within three years.
"This alliance will strengthen both companies in the global market and is aligned with our long-term sustainable growth strategy," said Embraer CEO Paulo Cesar de Souza e Silva.
Boeing chief executive Dennis Muilenburg said: "Boeing and Embraer know each other well through more than two decades of collaboration. The value we see in this partnership has only increased since we announced our joint efforts earlier this year."
