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Bombardier Divests Transportation Division to Alstom

Infra News - Published on Mon, 24 Feb 2020

Image Source: Bombardier Alstom
Bombardier announced that it has made the strategic decision to focus exclusively on business aviation and plans to accelerate its deleveraging through the sale of its rail business. Bombardier has signed a Memorandum of Understanding with Alstom SA and the Caisse de dépôt et placement du Québec for the sale of its Transportation business to Alstom. Under the transaction, Bombardier and la Caisse will sell their interests in Bombardier Transportation to Alstom on the basis of an enterprise value of USD 8.2 billion. Total proceeds, after the deduction of debt-like items and transferred liabilities, including pension obligations, and net of BT cash, are expected to be approximately USD 6.4 billion, subject to upward adjustments of up to USD 440 million. After deducting la Caisse’s equity position between USD 2.1 billion and USD 2.3 billion, Bombardier would receive net proceeds of between USD 4.2 to USD 4.5 billion, including USD 550 million of Alstom shares for a fixed subscription price of EUR 47.50, monetizable after a three-month lock-up post-closing, subject to closing adjustments, indemnities and the EUR to USD exchange rate. Bombardier intends to direct these proceeds towards debt paydown and will evaluate the most efficient debt reduction strategies.

Bombardier has retained Citigroup Global Markets Inc. and UBS Investment Bank as its financial advisors and Norton Rose Fulbright as its lead legal advisor, with Jones Day advising on antitrust and competition matters outside Canada. National Bank Financial and Rockefeller Capital Management are acting as financial advisors to Bombardier’s Board of Directors.

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Posted By : Yogender Pancholi on Mon, 24 Feb 2020
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