Alstom confirms talks underway to buy Bombardier Transportation

FILE PHOTO: Trains are seen at the Alstom high-speed train TGV factory of the company in Belfort, France, February 6, 2019. REUTERS/Vincent Kessler

PARIS (Reuters) - French transport infrastructure company Alstom (ALSO.PA[1]) said on Monday it was in talks over a possible acquisition of the train business of Canadian company Bombardier (BBDb.TO[2]), which could be worth £7 billion (5.37 billion pounds) on an enterprise value basis.

"Alstom confirms being in discussions with Bombardier regarding a possible acquisition of Bombardier Transportation by Alstom. Discussions are ongoing. No final decision has been made," Alstom said in a statement.

A source familiar with the matter told Reuters on Sunday that Alstom was close to agreeing a deal to buy Bombardier's train business, which will give the unit an enterprise value of £7 billion. The takeover would help Alstom compete more effectively with Chinese rail giant CRRC Corp Ltd (601766.SS[3]), after European regulators last year blocked Alstom from merging with Germany's Siemens (SIEGn.DE[4]). Any deal would also follow Bombardier's decision last week to sell off its stake in the A220 passenger jet programme to Airbus (AIR.PA[5]) and the Quebec government.

Bombardier has been struggling to contain higher rail costs generated by a few problematic contracts in its nearly £36 billion order backlog.

Reporting by Sudip Kar-Gupta; editing by David Evans

Our Standards:The Thomson Reuters Trust Principles.[6]

References

  1. ^ ALSO.PA (uk.reuters.com)
  2. ^ BBDb.TO (uk.reuters.com)
  3. ^ 601766.SS (uk.reuters.com)
  4. ^ SIEGn.DE (uk.reuters.com)
  5. ^ AIR.PA (uk.reuters.com)
  6. ^ The Thomson Reuters Trust Principles. (thomsonreuters.com)

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