Passenger Rail, Rail Supply, Research & Development, Rolling stock & Rail Vehicle Design, Signalling & Communications

Alstom completes acquisition of Bombardier Transportation

Alstom

Almost a year since the purchase was announced, on January 29, Alstom formally completed the acquisition of Bombardier Transportation.

The now combined business comprises 75,000 people across 70 countries, with a combined revenue of €15.7 billion ($24.97bn). This brings the entity closer in size to Chinese manufacturer CRRC, the world’s largest with €20.9bn in revenue in 2018.

“Today is a unique moment for Alstom and the mobility sector worldwide, with the creation of a new global leader centred on smart and sustainable mobility,” said chairman and CEO of Alstom Henri Poupart-Lafarge.

Globally, Alstom will absorb Bombardier Transportation’s assets, besides some areas which Alstom agreed to divest to meet European Commission requirements. These included Alstom’s Coradia Polyvalent range of mainline trains and production facilities, Bombardier’s Talent 3 train series and some of the production facilities and Bombardier’s stake in the Zefiro V300 high speed joint venture with Hitachi. Alstom will also enable competitors access to some onboard signalling units.

Bombardier’s presence in the UK, Germany, Nordics, China and North America will extend Alstom’s customer base in France, Italy, Spain, India, South East Asia, Northern Africa and Brazil. Bombardier Transportation’s headquarters in Montréal, Québec will serve as the headquarters for Alstom in the Americas.

With Bombardier having significant production facilities in Australia, as well as elsewhere around the world, these will now form part of Alstom’s footprint, the company said in a statement.

“With those immediate strategic additions to Alstom’s already diversified footprint, the enlarged Group has access to deeper industrial expertise and is closer to its customers.”

According to Alstom, the company now has the “most complete” rail portfolio, with the acquisition extending the company into areas such as people mover and monorail. The company will also expand its signalling product line, becoming the second largest signalling business worldwide by revenue.

In research and development, Alstom will add to its development of technologies such as hydrogen-powered trains and autonomous trains systems such as predictive maintenance, signalling, and digital operations.

Alstom expects to find €400 million in cost synergies on an annual run rate basis by the fourth to fifth year following the transaction.

Poupart-Lafarge said that with fundamental drivers backing the rail sector, such as increased urbanisation, public investment, and the global push for sustainable transportation, Alstom will be able to meet these demands.

“More than ever, the world has to engage in a deep environmental and social transition to be able to address the great challenges of urbanization, equal opportunity to economic development and climate change. Transportation, essential to the working and social life but with great environmental impact is at the heart of this transition. Our responsibility, together with the 75,000 people of Alstom today, is to transform our unique set of assets created by this transaction into the enabler of this necessary transformation.”

The sale transforms Bombardier into a purely business jet manufacturer.

“With this transaction now complete, Bombardier begins an exciting new chapter focused exclusively on designing, building and servicing the world’s best business jets,” said Éric Martel, president and CEO of Bombardier.

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