By Meghan Summers

It is an exciting time for the aerospace industry.

Boeing Co (BA) will have a 51 percent stake in a joint company currently being negotiating with Brazilian aircraft maker Embraer (ERJ). This news comes as Boeing has seen new records being made each quarter.

Boeing has agreed to a Brazilian government demand that the U.S. company have no more than a 51 percent controlling share.

Boeing has sought Brazilian government approval of the partnership with Embraer that would create a new company focused on commercial aviation, excluding Embraer’s defense unit, Reuters reported three weeks ago.

The Valor Economico newspaper later reported that Boeing’s proposal would give it an 80 percent to 90 percent stake in a new commercial jet business with Embraer.

Embraer is the world’s third largest planemaker and the leader in the 70-seat to 130-seat regional jet market.

With the proposed tie-up Boeing would be the market leader in the smaller passenger jet market, creating stiffer competition for the CSeries aircraft program designed by Canada’s Bombardier Inc and backed by European rival Airbus SE.

Boeing’s initial plan to buy Embraer was rejected by the Brazilian government because it did not want a foreign company to control its defense unit for strategic security reasons.

The government maintains a so-called golden share in Embraer, a former state enterprise, that gives it veto power over strategic decisions, including Boeing’s push for a tie-up.

On Thursday Brazilian Defense Minister Raul Jungmann told reporters that Boeing had understood Brazil’s refusal to give up control of Embraer. He said negotiations on the creation of a third company were advancing well.

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