Bombardier sells out remaining shares in Airbus A220
Bombardier sold its remaining share in Airbus Canada to Airbus and the government of Quebec. The European manufacturer now owns 75% of the A220 program, with the remaining 25% in the hands of Quebec.
Bombardier will receive $591 million from Airbus, including $531 million received once the agreement will be closed, with the rest to be paid over the next two years. The Canadian manufacturer will be released from its funding obligations to Airbus Canada. With this new agreement, the share of the government of Québec will be made available to Airbus in 2026, three years later than the original deadline.
Airbus has also acquired Bombardier’s production capability for the A220 and A330 aircraft in Québec. These activities will now be carried out on the Saint-Laurent site by Stelia Aéronautique Saint Laurent, a newly created subsidiary of Stelia Aerospace, itself a subsidiary of Airbus.
“This agreement with Bombardier and the Government of Québec demonstrates our support and commitment to the A220 and Airbus in Canada. Furthermore it extends our trustful partnership with the Government of Québec,” said Airbus Chief Executive Officer Guillaume Faury in a joint statement, adding “this is good news for our customers and employees as well as for the Québec and Canadian aerospace industry.”
Since Airbus took majority ownership of the A220 program, total cumulative net orders have increased by 64%, reaching 658 units for the aircraft at the end of January 2020. According to the manufacturer, the deal will secure more than 3,300 Airbus jobs in Québec.
“This transaction supports our efforts to address our capital structure and completes our strategic exit from commercial aerospace,” said President and Chief Executive Alain Bellemare.
In the last few years, Bombardier has progressively abandoned its commercial aviation activities. On June 8, 2018, the company sold the majority of its shares in the CSeries program to Airbus, which since renamed the aircraft A220. In November 2018, Viking Air, which had acquired Bombardier’s Amphibious Aircraft (Canadair) program in 2016, took over the Q400 for $300 million. Finally, on June 25, 2019, Bombardier sold the CRJ regional aircraft program to Mitsubishi Heavy Industries for $550 million.