Airbus SE has agreed to take a majority stake in Bombardier Inc`s CSeries jetliner program, a deal that could allow the Canadian planemaker to sidestep U.S. tariffs threatened in a trade dispute with Boeing.
Here are key details of the deal that was announced late on Monday:* Airbus will get a 50.01-percent stake in the program at no initial cost. Bombardier will own about 31 percent and Investissement Québec, the investment arm of the Quebec government, will hold a 19-percent stake in the CSeries Aircraft Limited Partnership (CSALP), which makes and sells the jets.
* Bombardier to issue warrants to Airbus which will convert into up to 100 million Class-B shares at an exercise price of C$2.29 each. The warrants will have a five-year term from the date of issue.
* Bombardier needs to pay up to $700 million for up to 3 years for any cash shortfalls in the plane program after the deal closes in late 2018. At closing, there will be no cash contribution by any of the partners and CSALP will not assume any debt.
* CSALP`s headquarters and primary assembly line will stay in Québec.
* Airbus has offered to assemble some jets at its U.S. plant in Alabama for orders by American carriers, Airbus Chief Executive Tom Enders said.
* CSALP`s seven directors will include four nominated by Airbus, two by Bombardier and one by Investissement Québec. Airbus will name the chairman.
* The boards of Airbus and Bombardier, and the Québec government`s cabinet, have approved the deal. It still needs the Canadian government`s approval.
* The deal is expected to close in the second half of 2018.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)