Bombardier Inc. announced today that it has reached an agreement in principle for the sale of its recreational products business for an aggregate purchase price of $1.225 billion Cdn. This agreement was entered into by a corporation formed by Bain Capital, members of the Bombardier family and the Caisse de dépôt et placement du Québec.
This transaction all but completes Bombardier's action plan presented on April 3, 2003, a plan designed to restore the Corporation's balance sheet and liquidity profile and focus on the aerospace and transportation businesses.
"Earlier this year, we completed a successful equity issue and announced the divestitures of our Defence Services unit, Belfast City Airport and Bombardier Capital's business aircraft portfolio," said Paul M. Tellier, President and Chief Executive Officer. "Once fully completed, this plan will have generated in excess of $2.5 billion Cdn, well over the initial target of $2 billion Cdn."
Bombardier's Board approved the agreement following a recommendation by the independent committee chaired by L. Denis Desautels and created for the purpose of supervising the sale process for the recreational products business and reviewing the related party transaction.
"As soon as our action plan was announced, members of the Bombardier family expressed an interest in participating in the process to ensure the stability and continuity of this heritage asset. As a party to the group of buyers, they are meeting this goal and we are pleased we have reached an agreement to sell the business as a full entity, at a fair price and in a timely and efficient manner that secures full value for all shareholders," he continued.
"We took appropriate steps to make certain that the rights of all shareholders were fully protected through a process that involved the highest standards of governance," concluded Tellier.
The Board received favourable fairness opinions from its own financial advisor, UBS, and from Morgan Stanley, financial advisor to the independent committee. Directors of Bombardier who are members of the Bombardier family abstained from participating in Board meetings in which the transaction was considered and did not vote on the transaction.
Completion of this transaction is subject to certain purchase price adjustments, execution of definitive acquisition and financing documentation and to the approval of all required governmental authorities and to other consents and other usual conditions. It is expected that the transaction will be closed by mid-fall 2003.
Bombardier Recreational Products designs, develops, builds, distributes and markets Sea-Doo® watercraft and sport boats, Ski-Doo® and Lynx® snowmobiles, Johnson® and Evinrude® outboard engines, Evinrude direct injection and Evinrude E TEC™ technologies, Bombardier™ ATVs, Rotax™ engines and karts, as well as utility vehicles.
Bombardier Inc., a diversified manufacturing and services company, is a world-leading manufacturer of business jets, regional aircraft, rail transportation equipment and motorized recreational products. It also provides financial services and asset management in business areas aligned with its core expertise. Headquartered in Montréal, Canada, the Corporation has a workforce of some 75,000 people and manufacturing facilities in 25 countries throughout the Americas, Europe and Asia-Pacific. Its revenues for the fiscal year ended Jan. 31, 2003 stood at $23.7 billion Cdn. Bombardier shares are traded on the Toronto, Brussels and Frankfurt stock exchanges (BBD, BOM and BBDd.F).
®, TM Trademarks of Bombardier Inc. or its subsidiaries.
Vice President, Public Relations and Communication