Airbus Agrees to Buy Bombardier A220 Stake for $591 Million
February 13 2020 - 12:55AM
Dow Jones News
By Benjamin Katz
Airbus SE has agreed to buy Bombardier Inc.'s remaining stake in
the A220 jet program, ending the Canadian manufacturer's
involvement.
Bombardier will receive $591 million net of adjustments, with
Airbus increasing its stake in the A220 program to 75%. The
government of Quebec will own 25% of the program after the
transaction, Airbus said in a statement Thursday.
The deal ends Bombardier's involvement in the aircraft it
created, formerly known as the CSeries, after delays and cost
overruns forced it to initially hand over a majority stake to
Airbus in 2017. Airbus has since boosted sales of the jet by 64% to
658 aircraft at the end of January.
The deal releases Bombardier from its funding commitment that
required the company to cover up to $350 million in annual losses
over a set period as part of the initial stake sale.
Bombardier said last month that it would review its holding in
the joint program, after new financial projections for the A220
pushed out expectations for when the aircraft would become
profitable.
The Wall Street Journal earlier reported that Boeing Co. 737 MAX
customer, Green Africa Airways, is in talks to buy as many as 100
of the aircraft.
Write to Benjamin Katz at Ben.Katz@wsj.com
(END) Dow Jones Newswires
February 13, 2020 00:40 ET (05:40 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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