UPDATE 5-Canada gov't, Bombardier still far apart in aid talks - sources

Fri Apr 15, 2016 7:29pm EDT
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(Adds details on talks, background)

By Allison Lampert and David Ljunggren

MONTREAL/OTTAWA, April 15 (Reuters) - Canada's Liberal government and Bombardier Inc are still not close to reaching a deal on aid for the struggling manufacturer, making an agreement before its annual meeting this month unlikely, according to well-placed sources.

The firm, based in the province of Quebec, wants Ottawa to invest $1 billion in its new CSeries passenger jet, which is years behind schedule, billions of dollars over budget and has won relatively few orders so far compared to its rivals.

A source with knowledge of the talks said one sticking point is that Ottawa wants Bombardier to commit to certain performance guarantees, and even suggested the government could walk away from aid talks.

"We want to help, but it's got to make sense," said the person, who asked to remain anonymous because of the sensitivity of the matter.

Bombardier and Ottawa are at odds over the level of the Canadian government's involvement in the day-to-day running of the company, a second person familiar with the talks said.

Government proposals for operational oversight in return for funding represent "a level of micro-management that is beyond what any normal investor or board member would expect," the person added.

Speaking to reporters in Toronto, Innovation Minister Navdeep Bains said the government is having "constructive" discussions with the company.   Continued...