BRUSSELS (Metro Rail News): The European Commission has given its clearance to the acquisition of the rail business of Canadian engineering firm Bombardier by French train maker Alstom. Alstom, which makes the French TGV high-speed trains had signed an agreement this year to buy full control of Bombardier transportation for a price 5.8-6.2 billion euros ($6.3-6.7 billion) paid via a mix of cash and new Alstom shares.
The Commission had launched an investigation and initially found that the transaction raised serious competition issues. The bloc’s competition authorities cleared the acquisition on Friday after Asltom offered “significantly improved” commitments before the commission.
Both firms are leading train makes and suppliers of the European Union. This move will further make France the second largest producer of the train after China. “It includes a transfer of Bombardier Transportation’s contribution to the V300 ZEFIRO very high-speed train and an offer of IP licence to Hitachi for the train co-developed by Hitachi and Bombardier”, said a press release issued by the firm. The system will be used in future with very high-speed tenders in the UK, the note further added.
The move also proposes the divestment of the Alstom Coradia Polyvalent and the Reichshoffen production sites in France along with divestment of the Bombardier TALENT 3 platform and dedicated production facilities located within the Hennigsdorf site in Germany. However, the deal will continue to provide certain interfaces and products for some of Bombardier transportation, sources said.
The firm hopes for closing of the acquisition by the first half of 2021 according to its press note.