MONTREAL — Bombardier Inc. says it is in talks over a potential deal to sell its rail business to French train giant Alstom SA.
The deal would mark a major shift in Bombardier’s turnaround plan as the plane-and-train maker would cast off its problem-plagued largest division and commit itself solely to business jets, in part to help pay down more than US$9 billion in debt.
The would-be acquisition also signals an effort by Alstom to scale up amid rising competition from China’s state-owned CRRC, the world’s largest train maker.
Bombardier and Alstom say discussions are ongoing and no final decision has been made.
Any deal is expected to come under intense scrutiny from antitrust regulators in the European Union. Last year, EU authorities blocked a proposed merger between Alstom and the train division of German industrial conglomerate Siemens AG, arguing the proposed tie-up would result in higher price tags on signalling systems and bullet trains.
Montreal-based Bombardier has sold several divisions since CEO Alain Bellemare took the helm in 2015, including its turboprop and aerostructure segments as well as its commercial airline unit, once touted as the company’s crown jewel.
This report by The Canadian Press was first published on Feb. 17, 2020.
Companies in this story: (TSX:BBD.B)
The Canadian Press