Bombardier has approached France's Alstom and Japan's Hitachi to find a merger partner for its rail business as it struggles to contain costs that have eaten into margins, sources told Reuters.
Bombardier has seen its share price plunge 37per cent since the start of the year after it flagged a 2019 profit warning on Jan.16. The French government is open to a rail deal for Alstom but no final decision has been made on the terms of a potential transaction, another source said. Japanese conglomerate Hitachi was also approached last year, the sources said, but it was not immediately clear whether the talks are still ongoing.
Bombardier's selection of its preferred merger partner will ultimately hinge on the likelihood of winning antitrust approval and the remedies that can be offered to soothe competition concerns, the sources said.
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