Bombardier to sell its stake in former CSeries (A220), says BMO
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October 16, 2019 - by RICHARD DUFOUR for lapresse.ca
Bombardier is expected to cede its ownership interest in the CSeries (A220) partnership to Airbus, according to BMO, much earlier than the agreement signed by the parties.
Using the proceeds of the sale to reduce the level of debt could become an important source of value creation, according to a research report released yesterday by BMO. Financing costs would decrease, but, perhaps more importantly, it would help alleviate investors' fears about the company's liquidity in the current context of the end of the cycle and economic uncertainty, it says.
"The value of the stake in the partnership combined with the amount to be generated by the sale of regional jets and possibly aerostructures division assets is greater than Bombardier's current market capitalization," Fadi Chamoun calculates.
This analyst believes that Bombardier can obtain 2.3 billion US from Airbus, from 700 to 800 million US for aerostructures division assets, in addition to 550 million US for its CRJ program, a transaction that must be concluded. in the first six months of the next year.
In total, it is 3.6 billion US that Bombardier can expect to obtain by selling these assets, thinks Fadi Chamoun.
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