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It's almost official - Alstom said "I Do" to Bombardier


Deucey
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https://www.metro-magazine.com/10125915/alstom-signs-definitive-agreement-for-sale-of-bombardiers-transportation-busines

Alstom signed the sale and purchase agreement with Bombardier Inc. and Caisse de dépot et placement du Québec (CDPQ) for the acquisition of Bombardier Transportation.

“The acquisition of Bombardier Transportationrepresents a transformational change for Alstom. It will enable the group to accelerate on its strategic roadmap and strengthen its leadership in the context of a dynamic market, at a time where sustainable transportation is at the heart of the global agenda. Bombardier Transportation will bring to Alstom complementary geographical presence to broaden Alstom’s commercial reach in key growing markets, strong product complementarities in rolling stock, strategic scale in services and signaling, industrial capacity in key countries, and a leading portfolio offering additional R&D capabilities to invest in green and smart innovation. Alstom will also welcome new talent and expertise, with the arrival of Bombardier Transportation employees,” said Henri Poupart-Lafarge, Chairman and CEO of Alstom.

Terms of the agreement have been adapted to the current situation. An approximate $335 million reduction in the price range has been agreed with Bombardier Inc. and CDPQ. Excluding any further downward adjustments linked to the net cash protection mechanism, the price range for the acquisition of 100% of Bombardier Transportation shares will be approximately $6.5 to $6.9 billion.

The financing structure remains the same as communicated previously, in particular the size and terms of the rights issue and the reserved capital increases of CDPQ and Bombardier Inc. As announced last February, pursuant to the new terms of the acquisition, CDPQ will become the largest shareholder of Alstom with approximately 18% of the share capital and voting rights.

Alstom is convinced of the strong strategic rationale for the acquisition and is confident in its ability to recover Bombardier Transportation’s commercial, operational, and profitability potential. Alstom confirms its objectives to deliver an approximate $473 million run rate cost synergies in year four to five and to restore Bombardier Transportation margin toward standard level in the medium term. The transaction is expected to be double digit EPS accretive in year two, post closing and to preserve Alstom’s strong credit profile with a Baa2 rating.

Alstom’s board approved these new terms and is confident in Alstom’s capacity to deliver strong value creation for all stakeholders through this acquisition.

Following positive progress on antitrust regulation process, the closing of the transaction is now expected for Q1 2021, subject to regulatory approvals and customary closing conditions, with an extraordinary shareholders’ meeting to be held in October.

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2 hours ago, QM1to6Ave said:

WOw, saving $335 million because of the pandemic. Talk about good strategy!

I'm sure it's that along with the penalties Bombardier owe due to warranty concerns and manufacturing delays.

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On 9/19/2020 at 10:02 AM, Kamen Rider said:

they'll still be in the business of making private jets once this is all said and done. 

Eh, shaky business to be in during a period of massive travel restrictions, economic troubles, and the appearance of carbon shaming as a political movement.

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20 hours ago, bobtehpanda said:

Eh, shaky business to be in during a period of massive travel restrictions, economic troubles, and the appearance of carbon shaming as a political movement.

IIRC, they’re doing something with Embraer in the 100 seat jet market. And with Airbus taking Kyoto Protocol and Paris accords seriously by announcing the hydrogen powered jet prototype, air travel is on the way to being cleaner with fewer chemtrails.

Plus the UK Government is going to announce bans on new fossil fuel car sales by 2030-35, so permanent blue skies are gonna be around in our lifetimes.

Also, as soon as these restrictions are up, folks will be on those planes again to tourist. Plus with all the 747s being retired and A380s not being purchased and/or retired, Bombardier could make ground taking slots that 737s would fly but are likely to take over from retired 767s, as well as routes A330s and 777s normally fly (since the latter two will shift to longer hauls).

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17 hours ago, Deucey said:

IIRC, they’re doing something with Embraer in the 100 seat jet market. And with Airbus taking Kyoto Protocol and Paris accords seriously by announcing the hydrogen powered jet prototype, air travel is on the way to being cleaner with fewer chemtrails.

Plus the UK Government is going to announce bans on new fossil fuel car sales by 2030-35, so permanent blue skies are gonna be around in our lifetimes.

Also, as soon as these restrictions are up, folks will be on those planes again to tourist. Plus with all the 747s being retired and A380s not being purchased and/or retired, Bombardier could make ground taking slots that 737s would fly but are likely to take over from retired 767s, as well as routes A330s and 777s normally fly (since the latter two will shift to longer hauls).

Oh, I mean specifically private jets are wasteful. Takes a lot of energy to put a metal tube in the sky for one person.

And nah, Embraer was going to tie up with Boeing but that's been killed.

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