UPDATE 3-Embraer wins $4 bln American Eagle deal; shares soar

Thu Jan 24, 2013 12:08pm EST
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* Republic Airways orders planes for American regional fleet

* Deal for up to 94 E-175s pending bankruptcy court approval

* Embraer shares post biggest jump in nearly four years (Adds comment from Embraer executive)

By Brad Haynes

SAO PAULO, Jan 24 (Reuters) - Brazil's Embraer SA on Thursday clinched a deal worth up to $4 billion to supply larger regional jets for American Airlines' regional network, sending shares soaring on hopes for stable production this year.

Embraer and Republic Airways Holdings Inc signed a contract for 47 E-175 jets, with an option to acquire an additional 47 aircraft. The new aircraft will be operated by Republic under AMR Corp's American Eagle brand.

The contract provides welcome relief for the order-starved Brazilian planemaker after it lost the first major U.S. order for regional jets under labor deals allowing regional affiliates to fly larger planes. In December, Canadian rival Bombardier Inc booked a Delta Air Lines deal for up to $3.29 billion.

And the battle for pent-up demand in the U.S. is just getting started, according to Paulo Cesar de Souza e Silva, the head of Embraer's commercial aviation unit.

"American is still going to buy more of that size plane," Silva said in a telephone interview, laying out the sales campaigns ahead. "We've got American, United, US Airways and regional operators too. In the next 18 months those campaigns will determine orders for about 250 to 400 planes."   Continued...