Bombardier agrees to sell rail unit to Alstom in $8.2 billion deal
Canada’s Bombardier said on Monday it had agreed to sell its rail division to France’s Alstom for an enterprise value of $8.2 billion, as it focuses more attention on its aviation business and pays down debt.
That price tag includes equity plus debt. The deal will be done mostly in cash, with a chunk paid in new Alstom shares, Bombardier and Alstom confirmed in separate statements.
Bombardier said it would be receiving net proceeds of between $4.2 and $4.5 billion, once it accounts for the portion that will go to Canadian pension fund manager Caisse de dépôt et placement du Québec, a 30% shareholder in the rail unit.
The memorandum of understanding between Bombardier and Alstom was approved by both companies' boards.