The only thing the Chinese are interested in is technology and knowledge transfer. They are not interested in managing and learning to manage western enterprises. Furthermore BBD's commercial aircraft portfolio does not suit the needs of China. Putting it simply, an RJ
in China is B777. That is where they want to go. But to get there, they need more knowledge, not more small airplane programs.
So what Bombardier is doing is preparing its show room with four (to be) standalone businesses. They need to sell some assets as their balance sheet is deteriorating, but to sell one of these businesses as a whole within the next year will be difficult.
1) Train Business: I don't think they will sell it for two reasons. First, no one wants this business. GE
wants Alstom's power gen business, but not interested in trains. It is a low margin business and in Europe's Ansaldo is now on sale by its Italian owner (Finm.). Second, Bombardier is bidding for Ansaldo's signaling business, so that would mean they want to invest even more in their Transportation portfolio.
2) Business Aircraft: This is their family jewel. But given that they have the G7
in development where they will likely partition a great deal of the engineering of that business to their Aerostructures and Engineering business, it is not ready to sell it as a whole just yet. But I do see an opportunity to sell Learjet. It has a great brand, and perhaps Honda or some equity investors might be interested (provided they have the right management).
3) Commercial Aircraft: Here I see some quick assets sale opportunities. No not China or Russia. I think those options are gone for obvious reasons. But I do see countries like Indonesia or India willing to buy the CRJ or Q400 portfolios. They have been eager to start their own home grown commercial aircraft business but have failed over the decades. Instead of building brick by brick, perhaps they may buy the Q400 and/or CRJ business.
4) Engineering Services and Aerostructures: I am not too sure exactly what this one will be. But it has no value for the near term other than tremendous opportunities. BBD has quite a bit of engineering know-how that they can also sell. BBD has quite a bit of unused manufacturing capacity which they can make parts for Boeing and Airbus. They need to find markets, and this will take time.
So what I see in the near term is bits and pieces of each business unit if there are buyers. I do not see the CSeries program for sale as that program has more potential in the long term than the Q400 and the CRJs. Plus no one wants a half baked product.
Also, if they sell the Q400 program, the de Havilland site is a real estate gold mine given its proximity to the downtown core and the sky rocketing real estate prices. Yes, they have their hands tied with the Ontario government on that site, but they have other levers (they have 2 site in Ontario Kingston and Thunder Bay in their transit business which they can transfer investment and jobs).
[Edited 2014-09-02 18:33:05]