EU regulators have set a deadline for a decision on whether to give the green light to plans by French train-maker Alstom to take over rival Bombardier Transportation.
Back in February, the parent company of Bombardier Transportation, which has its º£½ÇÊÓƵ train-making factory in Derby, confirmed it had agreed to sell the business to Alstom for up to 6.2 billion euros.
At the time, Bombardier Inc signed a memorandum of understanding with the French firm to sell its rail business in order to reduce its huge debts and focus on the business jet market.
However, the deal is subject to regulatory approval from the EU. The EU competition enforcer can either clear the deal with or without conditions or open a four-month long investigation if it has serious concerns.
Now, according to a filing on the European Commission’s website, it has set itself a deadline of July 16 to make a decision.
If given the go-ahead, the combined business would create the world’s second largest train manufacturer, with the capacity to take on the top manufacturer, China’s CRRC Corp.
However, the EU regulator has previously blocked some attempts by train manufacturers to join forces. Last year, a planned tie-up between Alstom and Siemens collapsed due to European regulatory concerns.
European Union competition regulators blocked the Alstom-Siemens deal, fearing the tie-up would hurt competition and lead to higher prices for consumers.
This time around, some unions have voiced concern over the Alstom-Bombardier deal.
Headquartered in Berlin, Bombardier Transportation’s º£½ÇÊÓƵ train-making factory is in Litchurch Lane, Derby.
The site is currently busy delivering several major orders to key customers, including West Midlands Trains, Greater Anglia and South Western Railway.
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The Unite union, which represents many workers at Litchurch Lane, has received assurances from senior executives at Bombardier about the future of the Derby train factory, which employs around 2,000 people. It is hoping to receive the same reassurances from Alstom.
Meanwhile, German trade union IG Metall union has urged the German government to look at the matter and has raised concerns.
If EU regulators give clearance, it is expected the deal could be completed during the first half of 2021.
