Having received all required regulatory approvals, Airbus SE, Bombardier Inc., and Investissement Québec (IQ) have agreed to close the C Series transaction effective on July 1, 2018. The transaction by which Airbus will acquire a majority stake in the C Series Aircraft Limited Partnership (CSALP) was initially announced in October 2017. The Mirabel, Québec-based partnership, originally established between Bombardier and IQ, will obtain Airbus’ global procurement organization and expertise in selling, marketing, and producing the C Series 100-to-150-seat jet aircraft.
The partnership’s head office, primary assembly line, and related functions will remain in Mirabel – preserving more than 2,000 jobs there. The partnership also positions the location as Airbus’ largest research and development center outside Europe.
Canada’s Minister of Innovation, Science, and Economic Development, the Hon. Navdeep Bains, said, “The partnership will leverage Airbus’s $82-billion global supply chain, which will provide significant opportunities for Canadian aerospace companies.”
Bombardier will continue with its current funding plan of CSALP, with these updated terms: Bombardier will fund the cash shortfalls of CSALP, if required, during the second half of 2018, up to a maximum of US$225 million; during 2019, up to a maximum of $350 million; and up to a maximum aggregate amount of $350 million during the following two years. Any excess shortfall will be shared proportionately among CSALP’s Class A shareholders.
The C series program continues to ramp up. Having delivered 17 aircraft in 2017, it is gearing up to double its deliveries in 2018.
The parties expect increased demand to support a second C Series Final Assembly Line (FAL) in Mobile, Alabama, dedicated to supplying U.S.-based customers. Airbus opened its A320 family FAL in Mobile in September 2015. Significant C Series production efficiencies are anticipated by leveraging Airbus’ production ramp-up expertise.
Philippe Balducchi, CEO of the C Series partnership, said, “Our teams have worked tirelessly to merge cultures and bring operations together well ahead of schedule and are confident in our ability to make this win-win partnership a thriving commercial success.”