UPDATE 4-Airbus, Bombardier end talks over CSeries jet investment

Tue Oct 6, 2015 10:04pm EDT
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(Adds link to earlier exclusive, context on Boeing in para 7)

By Allison Lampert, Andrea Shalal and Tim Hepher

MONTREAL/WASHINGTON/PARIS Oct 6 (Reuters) - Airbus on Tuesday called off talks with Bombardier over propping up the troubled CSeries jet, leaving the Canadian plane maker facing dwindling options to keep alive its dream of competing in the aerospace big league.

The latest blow to Bombardier, which has been trying to shore up its shrinking cash reserves for months, came after Reuters reported exclusively that Bombardier had made an offer to Airbus.

Both companies acknowledged that talks had taken place. A person familiar with the situation said Airbus had ended the talks shortly after they became public.

Under the proposed tie-up, Airbus would have helped Bombardier complete development of the troubled aircraft in exchange for a controlling stake in the program, effectively ending Bombardier's independent efforts to break into the lower end of the global airplane market dominated by Airbus and Boeing .

Bombardier is likely to take a strategic pause and regroup after the sudden end to what some executives had seen as a promising possibility, according to one source.

Among the options were reviving contacts with Chinese investors, and potentially Boeing, as well as a renewed drive to sell stakes in the company's rail and business jet units, the source said.

Boeing enjoys closer relations with Bombardier's arch-rival Embraer of Brazil, and is seen as less likely to be interested in any tie-up with Bombardier.   Continued...