Airbus, Bombardier and Investissement Québec agree C Series Partnership closing effective July 1, 2018
· Airbus to acquire majority stake in the C Series Aircraft Limited Partnership, effective July 1, 2018
· All regulatory approvals required for the closing of the transaction have been obtained
· Partnership head office, leadership team and primary final assembly line located in Mirabel, Québec (representing some 2,200 employees and subcontractors), with the support of the C Series global supply chain
· Partnership brings together two complementary product lines, with 100-150 seat market segment projected to represent 6,000 new aircraft over the next 20 years
· Addition of Airbus’ global reach to create significant value for C Series’ customers, suppliers, employees, shareholders and communities
· Significant C Series production efficiencies anticipated by leveraging Airbus’ production ramp-up expertise
· Growing market for C Series to support second Final Assembly Line in Alabama, serving U.S. customers
Amsterdam / Montreal, June 8, 2018 – Having received all required regulatory approvals, Airbus SE (EPA: AIR), Bombardier Inc. (TSX: BBD.B) and Investissement Québec (IQ) have agreed to close the C Series transaction effective on July 1, 2018. The transaction by which Airbus will acquire a majority stake in the C Series Aircraft Limited Partnership (CSALP) was initially announced in October 2017. The Mirabel-based partnership, which was originally established between Bombardier and IQ, will benefit from Airbus’ global reach, scale, procurement organization and expertise in selling, marketing and producing the C Series – a state-of-the-art jet aircraft family in the 100-150 seat market.
Airbus will work with its partners Bombardier and IQ to fully unlock the C Series’ potential and create significant new value for customers, suppliers, employees, shareholders and the communities in which the partnership operates. The partnership’s head office, primary assembly line and related functions will be based in Mirabel, Québec.
As previously announced, Bombardier will continue with its current funding plan of CSALP. Due to the early closing of the partnership, the terms of this plan are updated according to the following schedule: Bombardier will fund the cash shortfalls of CSALP, if required, during the second half of 2018, up to a maximum of US$225 million; during 2019, up to a maximum of US$350 million; and up to a maximum aggregate amount of US$350 million over the following two years, in consideration for non-voting participating shares of CSALP with cumulative annual dividends of 2%. Any excess shortfall during such periods will be shared proportionately amongst CSALP’s Class A shareholders. Airbus will consolidate CSALP effective from July 1, 2018 onwards. Further financial information on the transaction will be provided later this year.
The C Series program continues to ramp up. Having delivered 17 aircraft in 2017, it is gearing up to double its deliveries in 2018.
With the C Series’ demonstrated in-service performance and the finalization of this partnership, the parties expect increased demand to support a second C Series Final Assembly Line in Mobile, Alabama, dedicated to supplying U.S.-based customers. The C Series is positioned to capture a large percentage of the estimated 6,000 aircraft needed in this market segment over the next 20 years.