By Skies Magazine | February 4, 2020 Estimated reading time 2 minutes, 46 seconds.
Bombardier is in talks with Textron Aviation surrounding a potential deal for the Canadian OEM’s business aviation unit, reported The Wall Street Journal.
The details of the potential blockbuster sale are unknown at this time, but the transaction would help Bombardier trim down its roughly US$9 billion debt.
In January, Bombardier’s stock plummeted 32 per cent after it warned in a preliminary fourth-quarter earnings report that it is anticipating a US$130 million loss for the period. Bombardier said this may force it to sell off assets in order to pay down debt – one of which is its stake in the Airbus A220 commercial jet program.
The Montreal-based OEM has reportedly considered selling its transportation division as well.
After the news broke of the company’s talks with Textron, the Canadian OEM’s stock jumped over 10 per cent on the market.
These aren’t the first rumblings of a deal between the two manufacturers. In 2016, The Financial Post reported that Textron had admitted interest in purchasing Bombardier’s Learjet program. At the time, Bombardier CEO Alain Bellemare was quoted as calling the light business jet market “oversupplied” and “remarkably competitive.”
Currently, Bombardier builds its line of Learjets at a production facility in Wichita, Kan., only four miles away from Textron’s headquarters. At that facility, Bombardier’s 1.24 million square-foot site currently employs over 2,000 people according to the company, though it is unknown whether or not Textron would continue operations out of that location.
A merger of the Bombardier and Textron business aviation portfolios would create redundancies in some segments, while offering opportunity in others.
Much of Textron’s product line focuses on the light and medium jet categories, meaning there would be some overlap with Bombardier’s Learjet family, for example. However, the Montreal-based OEM’s luxury Global aircraft family would probably fit nicely into the gap left by the Citation Hemisphere program, suspended in July 2019.
