Embraer takes control of Mahindra aerospace venture by December
India gains a stronger local platform for defence aircraft production
Overview
Embraer plans to take control of its proposed Indian aerospace venture with Mahindra. Under an investment agreement notified on October 9, 2026, the Brazilian aircraft maker will buy 51% of . Mahindra Defence Systems will keep 49%. Novavayu was previously a wholly owned Mahindra subsidiary. The deal is expected to close by December 1, 2026, subject to the transaction process.
The venture grew from agreements signed in February 2024 and October 2025. They aimed to promote Embraer’s for the ’s . The venture could support local production, assembly, suppliers and maintenance. That would advance , while giving Embraer control and Mahindra a role in India’s defence industry. However, the venture does not secure an aircraft order. The MTA contest remains open, and the partnership may improve the C-390’s position without ensuring India chooses it.
Timeline
Mahindra discloses the proposed ownership change
Mahindra’s regulatory filing said the sale would provide approximately Rs 5,10,000 in for the 51% stake. After completion, Novavayu would cease to be a and become an of Mahindra Defence Systems.
Embraer agrees to acquire 51% of Novavayu
Embraer signed an to acquire a 51% equity stake in Novavayu Aerospace from Mahindra Defence Systems. Embraer would become the , while Mahindra Defence Systems would retain 49% ownership.
Transaction expected to close
Mahindra said the Embraer investment is expected to be completed on or before December 1, 2026. Completion will still depend on the and any , after which Embraer is expected to hold 51% and Mahindra Defence Systems 49% of Novavayu.
The venture links corporate control to the MTA bid
The proposed ownership structure gives Embraer control over the Indian venture and leaves Mahindra as the 49% Indian industrial partner. The arrangement is intended to strengthen the C-390’s position in the IAF’s Medium Transport Aircraft competition, but it does not constitute an .
Mahindra incorporates Novavayu Aerospace
Mahindra Defence Systems incorporated as a dedicated aerospace and defence company. Before the proposed transaction, Novavayu was a within the Mahindra group, creating a corporate platform for the planned partnership.
Partners formalize C-390 cooperation
Embraer and Mahindra signed a covering the C-390 proposal for India’s MTA programme. The agreement expanded cooperation into , industrialisation and the development of India as a potential C-390 manufacturing, assembly and .
The MTA competition remains undecided
India’s MTA requirement is the institutional reason for the partnership, because the companies are positioning the C-390 for a future IAF transport-. Other bidders could face a stronger competitor with an , but the venture’s creation does not decide the aircraft competition or guarantee production orders.
Partners propose localized C-390 industrialization
The cooperation framework envisages local manufacturing, assembly, supply-chain participation and activity in India. It aligns the proposed venture with and objectives, while giving Mahindra a role in India’s and Embraer control over the aircraft programme and industrial strategy.
Embraer and Mahindra sign C-390 MoU
Embraer Defense & Security and Mahindra signed a to pursue the for the Indian Air Force’s . The agreement called for discussions with the IAF and India’s aerospace industry on programme requirements and an .