Shares of Bombardier soar following new deal

Shares of Bombardier up more than 20 per cent after singing CSeries deal with Airbus

Shares in Bombardier Inc. soared more than 20 per cent in early trading after the company gave up majority control of its CSeries aircraft program to European company Airbus Group.

Bombardier shares were up 53 cents at $2.89 on the Toronto Stock Exchange, shortly after trading began Tuesday.

The move followed an announcement of a partnership between the two aircraft manufacturers after the close of markets Monday.

Related: Compensation to Bombardier senior executives rose nearly 50 per cent last year

The agreement comes in the wake of an announcement by the United States of 300 per cent in preliminary duties on exports of the aircraft following a trade complaint by Boeing.

Under the deal, the CSeries headquarters and main assembly line will remain in the Montreal area, but a second line will be set up at Airbus’s plant in Alabama to meet demand from U.S. customers and avoid duties.

The partnership is expected to result in lower production costs, but Airbus won’t be paying any money for the stake or absorb Bombardier’s (TSX:BBD.B) large debt.

Related: Canada, U.K. using CETA as new trade model

Airbus will acquire a 50.01 per cent interest in the CSeries Aircraft Limited Partnership in exchange for access to its sales, logistics, procurement and support expertise. Bombardier will own 31 per cent and the Quebec government’s investment agency will hold 19 per cent.

Airbus can buy out Bombardier after 7.5 years and the Quebec government in 2023.

The Canadian Press

Just Posted

Paintearth County eyes Valley Ski Hill viability

Slope erosion and ageing equipment are factors

Halkirk holds market

Annual Christmas event

UPDATE: Danny has been found safe. Stettler area family pleads with public to help find their missing loved one

Was last seen about 11:30 p.m. leaving a residence in Stettler to ride his peddle bike home to Byemoor, about 70 km

Castor honours Canada’s veterans

Holds Remembrance Day service

Gus Wetter awards

Volleyball season coming to close

WATCH: Remembrance Day in Lacombe fills LMC

2018 marked 100 years since the end of First World War

Fear of constitutional crisis escalates in U.S.; Canadians can relate

Some say President Donald Trump is leading the U.S. towards a crisis

Canada stands pat on Saudi arms sales, even after hearing Khashoggi tape

Khashoggi’s death at Saudi Arabia’s consulate in Istanbul further strained Riyadh’s already difficult relationship with Ottawa

Feds pledge money for young scientists, but funding for in-house research slips

Canada’s spending on science is up almost 10 per cent since the Liberals took office, but spending on in-house research is actually down

Carjacking sees 76 year old woman’s vehicle stolen

Wetaskiwin RCMP with Crime Reduction Unit charge robbery suspects

Disabled boy has ‘forgiven’ bullies who walked on him in stream, mom says

A Cape Breton teen who has cerebral palsy was told to lie in a stream as other kids walked over him

Canada Post no longer guarantees delivery times amid more rotating strikes

The Canadian Union of Postal Workers closed two major processing centres in Ontario and B.C.

McGill students vote overwhelmingly to change Redmen team nickname

Student union held a referendum after a campaign by Indigenous students

Calgarians head to the polls to declare ‘yea’ or ‘nay’ on Winter Games

The question “are you for or are you against hosting the 2026 Olympic and Paralympic Winter Games?” was to be posed to them Tuesday in a plebiscite to help determine whether the city should move ahead with a bid.

Most Read