Bombardier...deal baloons to $7.9BMONTREAL (CP) - Bombardier Transportation's contracts to help
modernize London's subway system have ballooned to $7.9
billion.
When tentatively announced last May, they were estimated at
$6.9 billion over 30 years. And now the bigger amount will
cover just 15 years.
Bombardier announced the new figures Monday, listing the
contract awarded by the Metronet consortium - in which it is a
partner - for the supply of rail cars, signalling, maintenance
and project management.
The contracts include the project management and the supply of
1,738 subway cars and new signalling systems.
New subway car fleets will be built in Bombardier's plant in
Derby, England, between 2008 and 2015.
Bombardier Transportation is also one of the five equal
shareholders of Metronet Rail BCV Holdings and Metronet Rail
SSL Holdings, along with Atkins, Balfour Beatty, Seeboard and
Thames Water.
The shareholders have each invested $162 million in the
consortium. Metronet Rail BCV Finance and Metronet Rail SSL
Finance have raised a further $6 billion.
In the first 7½ years of the 30-year public-private
partnership, Metronet will invest over $16.2 billion
upgrading, replacing and maintaining the London Underground.
"We will be working in partnership with the other Metronet
shareholders to bring major improvements to travellers in
London and to ensure a massive investment into the London
Underground systems," Pierre Lortie, president and chief
operating officer of Bombardier Transportation, said in a
release.
The contracts come at a crucial time for parent company
Bombardier Inc. (TSX:BBD.B) of Montreal. Last week the
transportation giant reported a $1-billion quarterly loss.
The firm announced it will sell its recreational products
division - including the pioneering Ski-Doo snowmobile - make
an $800-million share issue and halve its dividend.
On Friday, Bombardier stock lost 20 cents to $3.36.
© Copyright 2003 The Canadian Press