Exclusive: Bombardier seeking investors for all business units - sources

Wed Sep 30, 2015 7:24pm EDT
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By Andrea Shalal, Mike Stone and John Tilak

WASHINGTON/NEW YORK/TORONTO (Reuters) - Canada's Bombardier Inc (BBDb.TO: Quote) is exploring the sale of a stake in any of its business areas, not just its rail unit, to ensure it can finish development of its delayed CSeries jet, according to four sources familiar with the situation.

The Montreal-based company has hired investment bankers to look at a variety of financing options, the sources said, including selling aerospace or rail assets in full or in part, forming joint ventures or bringing in private equity investors.One source familiar with the company's thinking said Bombardier hoped to secure some additional source of cash, through the sale of a business unit or another arrangement, perhaps with a Canadian government, before its third-quarter earnings report on Oct. 29.

Two of the sources said Bombardier's board was expected to meet in the next few days, but it was not immediately clear what was on the agenda.

A banking source said the company is not desperate for cash but wants to be proactive and shore up its stock, which has dropped more than 50 percent in the last year as it pushes to bring the new CSeries jet into service, years late and billions over budget.

If Bombardier announces a financing deal in the coming weeks, it may surprise some investors, coming less than a year after the company's last multi-billion dollar cash infusion. In February, Bombardier raised C$1.1 billion in equity and $2.25 billion in debt.

In May, the company said it planned to file late this year to launch an initial public offering for a minority stake in its rail unit, Bombardier Transportation.

Spokeswoman Isabelle Rondeau said on Wednesday that plan had not changed.

"Everything is on the table," said the source familiar with the company's thinking.   Continued...

Banners for the Bombardier company are shown at a sporting event in Lake Louise, Alberta in this December 2, 2009 file photo.  EUTERS/Andy Clark/Files