Planemaker Bombardier Inc said on Thursday the Canadian province of Quebec agreed to invest $1 billion in its CSeries aircraft program, which has struggled with years of delays and cost overruns. Bombardier said it would transfer the assets, liabilities and obligations of the program to a newly created limited partnership, in which the company will hold a 50.5 percent equity stake and Quebec the rest.
The investment, which has been in the offing for months, will be made in two instalments of $500 million, with the first on June 30 and the second on September 1, the Montreal-based company said. Quebec and Bombardier want the federal government to match the province's $1 billion investment in the narrowbody jet program, but talks have dragged on amid governance concerns by the country's Liberal government over the plane-and-train-maker's dual class share structure. Quebec Premier Philippe Couillard said earlier this month the terms of the federal and Quebec deals with Bombardier would need to be complementary but not necessarily the same. "We understand that the deal structure is legal from a WTO perspective," analysts at BMO Capital Markets wrote in a note.