With Bombardier Transport, Alstom becomes world number 2 in railways – economy

It is now done: by finalizing the transaction with Bombardier’s rail activities, Alstom has become the world number 2 in rail. What to compete with an extremely sharp Chinese competition.

After having suffered a humiliating refusal two years ago from the European Commission in its marriage project with the German group Siemens, Alstom finalized this Friday, January 29, the acquisition of the railway activities of Bombardier. The Canadian company, which will refocus on the construction of business jets, will receive from Alstom a check for 4.4 billion euros, while the French industrialist is absorbing the debt of 1.1 billion euros. In doing so, Alstom becomes world number 2 in the rail sector, a market dominated by the Chinese giant CRRC which devours market share.

Bombardier-Alstom: a transaction worth 5.5 billion euros

It’s a revenge for Alstom. In 2019, the European Commission rejected the proposed merger with Siemens in the name of maintaining competition on the old continent. In the Bombardier case, no problem: the activities of the two groups are complementary and, moreover, Paris and Berlin have lobbied for the competition services in Brussels to take greater account of competition on a global scale. Among the strengths of this transaction, Alstom notes the geographical complementarity: while the French company is expanding in Spain, Italy, Brazil and India, Bombardier is present in Scandinavia, Germany, the United Kingdom and China. and in North America.

Rail transport: strong demand

In addition, Alstom also benefits from innovations developed by Bombardier, such as the monorail system. The order book of the two entities exceeds 70 billion euros, enough to work for several years in a booming market: metropolitan areas and large urban centers are emphasizing rail transport and soft mobility.

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