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Alstom acquires Bombardier Transportation

In addition to disposing of its Transportation business, Bombardier also divested its PRIMOVE division in January. TAUT drove a battery-equipped PRIMOVE tram prototype in Mannheim in April 2014. Image courtesy of TAUT

Alstom’s EUR5.5bn purchase of Bombardier Transportation was completed on 29 January, creating a company with 75 000 employees and combined sales of EUR15.7bn/year, second only to China’s CRRC. The final price was at the bottom of the range set out in the earlier agreement.

Henri Poupart-Lafarge, Chairman and CEO of Alstom, said: “Today is a unique moment for Alstom and the mobility sector worldwide, with the creation of a new global leader centred on smart and sustainable mobility. The integration of Bombardier Transportation will strengthen our leading position in the transport sector by widening our portfolio and providing critical scale.”

Bombardier is now focused exclusively on designing, building and servicing business jets, having sold its PRIMOVE subsidiary (inductive charging systems and traction batteries)
to Freiburg-based IPT Technology. Caisse de Dépôt et Placement du Québec is now Alstom’s largest shareholder, with 17.5% of the share capital. Bouygues holds 6%.

Alstom expects to generate EUR400m/year in cost savings through the acquisition, but the practical effect of this has still to be announced. It is not known if any product lines will be dropped or merged, but existing orders will be fulfilled from the factories already assigned to build them. The first signal of the direction the acquisition will take is likely to be revealed in bids that are made for new orders.