English 
Spanish 
3 min read
16 comments
Financial crisis, 45 days of negotiations and impasse with the union: what led to the end of the agreement with investors and left Avibras workers in a scenario of uncertainty?
The future of Avibras, one of Brazil’s most iconic arms companies, has suffered a major blow. After 45 days of intense negotiations, the group of investors trying to acquire the company announced that they were abandoning the deal due to a dispute with the Metalworkers’ Union. But what led to this decision? And what does it mean for workers and the national arms sector?
Conversations between investors and Avibras began with high expectations. The proposal presented promised job stability until 2025 and the extension of important social clauses. However, the conditions precedent of the contract were not met within the stipulated deadline, resulting in the termination of negotiations.
Contractual conditions not met
For the deal to be completed, specific contractual clauses had to be met. However, crucial details were never made public. This lack of transparency created uncertainty for both investors and workers.
- How to issue the Senior Citizen Card
- Abu Dhabi: The richest city in the world with a fortune of US$1,7 trillion and millionaires flocking to enjoy this luxury paradise!
- Fines are flying around! Uber creates a new category and, two days after its launch, there are inspections, vehicles are seized and fines of R$2.600 are issued
- Internet anywhere! Starlink antenna, Elon Musk's company, is now sold on Mercado Livre! See if it's worth buying
The investors tried to maintain dialogue, but the union was categorical: the terms of the proposal would only be voted on after the deal was confirmed. This stance, although understandable to protect workers, contributed to the impasse that culminated in the withdrawal.
Avibras' financial crisis is not recent. For more than two years, the company has been facing severe difficulties, leaving its employees without salaries for a staggering 20 months.
Employees without salaries for 20 months at Avibras
Imagine working without pay for almost two years? This is the reality for hundreds of Avibras workers. While the company was looking for a solution, the employees' situation became increasingly unsustainable.
Despite being in judicial recovery, the company was unable to implement an effective plan to attract investors and solve its financial problems. The failure to comply with contractual conditions was another sign that the process needed to be better structured.
With the end of the exclusivity agreement, Avibras now has the freedom to seek other investorsBut does the market still trust the company's ability to recover?
Possibilities for new investors
While the exiting group has said it is open to future negotiations, the company will need to rebuild its credibility to attract new offers. That involves both financial adjustments and an alignment with workers.
While the company’s future is at stake, the biggest losers continue to be the employees, who remain without a solution for their overdue salaries. Creditors may face even more delays in recovering their money.
The Avibras crisis raises a red alert for the entire national arms sector. In a competitive global market, internal problems can impact not just a company, but the reputation of the entire industry.
In this misgovernment, what will happen is the following: they will spend much more money buying scrap from abroad than reactivating this important defense industry. Neither Lula nor Bolsonaro are at the service of Brazil, but of external interests.
It was no different in the previous misgovernment.
As long as the union is indecisive, not to say clumsy, the deal will not happen.
Meanwhile, the National Public Debt (i.e. institutionalized theft) is “going down the drain,” around 50% of Brazil’s GDP, just in interest on the debt, while the principal is never repaid. We need to put an end to all this theft, which is bleeding the country dry and preventing everything else, including the maintenance of the national defense industry, which needs to have the Armed Forces as its largest and most stable client.