Bombardier reviews minority stake in Airbus JV, flags writedown; shares tumble

Bombardier shares shed nearly third of its value Thursday after the company warned its 2019 profits would be lower because of problematic rail contracts and said it might have to write down the value of a plane partnership with Airbus. Bombardier, which sold control of the A220 program to Airbus in 2018 for a token Canadian dollar as part of broader efforts to improve its financial footing, said the venture needed more investment and might be subject to a writedown during fourth-quarter results next month. Bombardier also said it is “reassessing” its minority stake in the A220 jet program, which will require additional cash to ramp up production. The Canadian plane and train maker is shedding underperforming commercial plane programs to focus on its stronger business jet and rail units. But Bombardier’s rail division, its largest unit by revenues, is wrestling with three rail projects in Europe, resulting in a $350m charge. “Although Bombardier’s transportation segment has been volatile, cost problems out of Europe look worse than the market has been anticipating,” Citi analyst Stephen Trent said in a note to clients.<br/>