Mitsubishi Heavy Industries acquires Bombardier’s regional jet program
The transaction completes Bombardier's aerospace transformation and refocus on business aviation
Mitsubishi Heavy Industries will acquire Bombardier’s regional jet program for US$550 million.
Under the agreement, MHI will assume liabilities amounting to about US$200 million, and Bombardier’s net beneficial interest in the Regional Aircraft Securitization Program (RASPRO), which is valued at approximately $180 million USD, will be transferred to MHI.
Tokyo-based MHI will acquire the maintenance, support, refurbishment, marketing, and sales activities for the CRJ Series aircraft, including the related services and support network located in Montréal, Québec, and Toronto, Ontario, and its service centres located in Bridgeport, West Virginia, and Tucson, Arizona, as well as the type certificates.
This acquisition is complementary to MHI’s existing commercial aircraft business, in particular the development, production, sales and support of the Mitsubishi SpaceJet commercial aircraft family. The maintenance and engineering capabilities of the CRJ program will further enhance critical customer support functions, a strategic business area for MHI in the pursuit of future growth.
The transaction represents one of the most important steps in MHI’s strategic journey to build a global aviation capability, said Seiji Izumisawa, president & CEO of MHI. “It augments these efforts by securing a world-class and complementary set of aviation-related functions including maintenance, repair and overhaul (MRO), engineering and customer support,” said Izumisawa.
The CRJ production facility in Mirabel, Qué., will remain with Bombardier. Bombardier will continue to supply components and spare parts and will assemble the current CRJ backlog on behalf of MHI. CRJ production is expected to conclude in the second half of 2020, following the delivery of the current backlog of aircraft.
“We are very pleased to announce this agreement, which represents the completion of Bombardier’s aerospace transformation,” said Alain Bellemare, president and CEO, Bombardier Inc. “Our focus is on two strong growth pillars: Bombardier Transportation, our global rail business, and Bombardier Aviation, a world-class business jet franchise with market-defining products and an unmatched customer experience.”
Bombardier also said that it will retain certain liabilities representing a portion of the credit and residual value guarantees totaling approximately US$400 million.
The transaction is expected to close during the first half of 2020 and remains subject to regulatory approvals and customary closing conditions.