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Bombardier in Negotiations to Sell Business-Jet Division to Textron

Bombardier is in talks to sell its business-jet division to Textron, the producer of Cessna, a media report says.
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Bombardier undefined shares are higher following a report that the Montreal plane-and-train producer is in talks to sell its business-jet unit to Textron  (TXT) - Get Free Report, the producer of Cessna planes.

The Wall Street Journal reported that the two companies have been in talks for weeks.

Bombardier shares at last check were up more than 10% at US$1.08. They dropped by a third in 2020 through Monday but have bounced off a 52-week low of 85 cents on Jan. 17. 

Textron’s stock was up about 8% around $50. The Providence, R.I., industrial group's shares were earlier up as much as 11%. It's trading in the middle of its 52-week range of $42 to $58.

Bombardier in mid-January issued a profit warning, "driven largely by actions at Transportation to resolve challenging projects."

The company also said that it may have to take a write-down in the value of the partnership it made with European plane maker Airbus  (EADSY) - Get Free Report.

The Bombardier-Textron negotiations reportedly began after the company began talks in mid-2019 to sell its train unit to Alstom  (AOMFF) of France. Those discussions have reportedly hit a snag, according to Bloomberg, over the valuation of the business, which is struggling with a production backlog,

Bombardier has about $9 billion in debt, the WSJ reported. The company has a big debt payment coming up next year, necessitating the sale of one of its businesses, according to Bloomberg.