Bombardier Says Quebec Deal Isn’t Contingent on Federal Aidby and
CEO says talks with province over aid are progressing well
Bombardier has not set a deadline to receive federal funding
Bombardier Inc. can complete a proposed $1 billion funding agreement with Quebec before separate negotiations with the federal government over aid are resolved, Chief Executive Officer Alain Bellemare said.
Talks with Quebec over the province’s purchase of a 49.5 percent stake in the C Series aircraft program, which is more than two years behind schedule and more than $2 billion over budget, are progressing well and “the closing should be pretty soon,” Bellemare told reporters in New York after a speech to the Wings Club on Thursday. Montreal-based Bombardier has said it expected to complete the deal in the second quarter.
Bombardier is balking at demands from the federal government that the company’s founding family loosen control and issue $1 billion in new stock, people familiar with the talks told Bloomberg News last week. Federal officials now believe it’s up to Bombardier to make the next move.
“Right now our focus is on negotiating with the federal government,” Bellemare said Thursday. “It’s complex. It takes time.”
A deal will be reached “when we can converge on a solution that makes sense for them and makes sense for us,” Bellemare said. Bombardier has not set a deadline to receive federal funding, he said. He specifically declined to comment on what is being negotiated with the federal government.
Prime Minister Justin Trudeau’s proposal to Bombardier would see his government and the province of Quebec each invest $1 billion directly in the company, along with a share sale that would raise another $1 billion to bolster its balance sheet, people familiar with the discussions said last week. They spoke on condition of anonymity because the negotiations are private.
Trudeau can’t see a point at which the government would walk away from talks with Bombardier, Reuters reported Thursday, citing an interview with the prime minister.
Recent C Series orders by Delta Air Lines Inc. and Air Canada are “what we needed to re-launch” the program, Bellemare also said Thursday.
“We are in a much better place today,” said the CEO, who joined Bombardier last year. “The company has got the financial resources, we have the right product, it is certified, we have the right team to sell it. We are seeing great momentum.”