Bombardier exits aerospace with A220 deal, and other dismemberments
CANADIAN plane maker Bombardier, which once made everything from snowmobiles to commercial jets, is poised to become a shadow of its former self as it sells off assets to reduce debt, reports Bloomberg News
CANADIAN plane maker Bombardier, which once made everything from snowmobiles to commercial jets, is poised to become a shadow of its former self as it sells off assets to reduce debt, reports Bloomberg News.
The company is completing its exit from commercial aerospace with the sale of its stake in the Airbus SE A220 programme, once known as the C Series, to the European planemaker.
Bombardier said in a statement it is also pursuing other 'strategic options to accelerate deleveraging.' The company is near a deal to sell its rail-equipment unit to French transport equipment giant Alstom.
'The C Series was a cash drain,' said Bombardier CEO Alain Bellemare. 'The strategy was always to exit commercial aircraft while protecting jobs. We've done that in a very responsible matter. We are now with two very strong businesses and we are continuing to look at our options to see if we can continue deleveraging.'
The dismembering Montreal-based Bombardier to retain only its private-jet division - while giving it a path to taming a US$10 billion debt load. The company's 7.85 per cent bonds due 2027 climbed 3.3 cents to 103 cents on the dollar, yielding 7.4 per cent, according to Trace data.
The company sold its turboprop-plane business to Longview Aviation Capital last year, and has agreements in place to offload its regional-jet operation and a wing plant in Northern Ireland. Those deals are on track to close in the first half of 2020, the company said in a statement.