Chapter 901: Spin-off Bombardier
Of course, the main problem is that the British government has no money!
If the development of Barron's previous life is to be followed, it will continue like this. Not to mention 2016, England has been delaying the construction of the first phase of the project until 2017, and repairs have been stopped, and the progress is simply slow.
The budget for the entire high-speed rail line 2 also increased from the initial total budget of 32.7 billion pounds to 62 billion pounds, and later to 106 billion pounds, which has seriously overrun!
To put it bluntly, except for a small part of the subsequent increase in budget funds that need to be invested in environmental protection and protection of cultural relics, most of them have been dragged out.
Doesn’t Cameron hope that the British high-speed rail line 2 will start construction as soon as possible?
Don't think that there are no "achievement projects" in Europe and the United States. The benefits of this high-speed rail line are obvious. It can not only strengthen the circulation of people and logistics in the UK, but also provide a large number of jobs in the UK. This kind of project is similar to infrastructure construction. , it can be said that it is very useful for Britain's economic recovery.
But on the one hand, because it is too "free", voices from all aspects are very noisy. On the other hand, the most critical issue is money.
Therefore, after hearing that Barron intended to take over the high-speed rail line 2 project, Cameron couldn't wait to meet him immediately.
"Are you really prepared to invest in this project? The budget for this project is as high as 40 billion pounds..."
Cameron didn’t hide anything, and said to Barron:
"According to the latest assessment, it is likely that the funds needed to be invested will be slightly higher than this figure."
"I understand that the High-speed Rail Line 2 project is very important to Britain, and I am willing to contribute my own efforts to this end, Mr. Prime Minister..."
Barron first reaffirmed his attitude and then said:
"But, in the final analysis, I hope that through this project, both me and the country can gain benefits and achieve a win-win situation, so before that, you need to meet several of my requirements."
"What do you want? You can just say it."
No matter what, Cameron hopes to listen to Barron's ideas first.
After all, with the investment in this project, I am afraid that no company in the UK can take over - except for the Duke of Devonshire in front of him.
This is why the British government has considered investing in this project from national finance before. But in reality, even if the British government has 40 billion pounds and may even have an additional budget, it is not their shortcomings. It can be started as soon as possible. It was originally scheduled to start in stages in 2016, but preparations for this must be made in the government budgets of previous years before then.
But if possible, Cameron definitely hopes to start this project during his term. After all, he himself is not sure whether he can be re-elected after the next election.
If this project can be launched during his term, there is no telling when it will be completed and opened to traffic, but at least the jobs created through High-Speed Rail Line 2 and the small and medium-sized enterprises that will benefit from it will be real - this is also true. They can all accumulate political achievements for him in the next election.
"First, I need to get an operating company to carry out this project..."
Barron's first request is that the British government provide the best possible support in his related acquisitions. After all, Barron's current industry does not include companies in the construction and operation of high-speed railways.
He already has some acquisition targets, the first of which is FirstGroup.
First Group PLC is a passenger transport company headquartered in England. Most of its revenue currently comes from England.
This group has three branches, namely Greyhound, FirstBus and FirstRail.
The Greyhound division operates intercity buses in the United States and Canada; FirstBus operates buses in the United Kingdom and Ireland; and FirstRail operates passenger trains in the United Kingdom and Ireland.
The current market value of the First Group is not high, at around 500 million pounds (about 750 million U.S. dollars), so it is not difficult for Barron's.
The other one is Eversholt Railway Group, one of the three largest railway vehicle leasing companies in the UK. It leases trains to passenger and freight railway companies under long-term contracts. It owns a wide range of train types, including regional, short-distance and high-speed passenger trains, as well as Freight locomotive. The company's current train fleet includes 3,474 passenger trucks, 63 cargo boxes, and two depots.
In the original time and space, Li Chaoren's Yangtze River Infrastructure acquired the railway group for 2.5 billion pounds two years later, but now, it is expected that the transaction can be completed within 2.3 billion pounds.
Now that he has entered the railway industry, Barron's ambition is naturally not just the high-speed rail line 2 project. He naturally hopes to acquire more related high-quality companies.
Both acquisitions are not too difficult, the key is the last one.
Barron hopes the British government will support his acquisition of Bombardier through Alstom.
Specifically, Barron's will acquire Bombardier and then spin it off—Bombardier's current main businesses are aviation and rail.
Many people may only have the impression of Bombardier of its business aircraft, but in fact, Bombardier Rail is also a technological leader in the fields of ultra-high-speed railways and rail trains.
If Alstom can merge Bombardier's railway business, it will surpass Siemens in scale and become the world's largest rail giant!
Of course, Alstom will be able to hold this number one position for less than a year...
Because when China's CSR and CNR merge into CRRC next year, they will take away the number one position from Alstom.
Currently, Bombardier's total market value is around US$20 billion. According to Barron's plan, after acquiring Bombardier, it will spin off its railway business and merge it with Alstom, leaving only its aviation business.
In fact, Bombardier's situation has not been good in recent years because its investment in research and development of the C-series commercial aircraft has been too high. In addition, due to the economic crisis, both its railway business and business jet business have been far less profitable than before. As of now, , Bombardier's foreign debt has exceeded 9 billion US dollars, and its financial situation is in crisis.
In Barron's previous life, Bombardier's C-series suffered from problems such as overspending on research and development costs and the "big stick" used by the United States to restrict its sales, causing Bombardier to fall into financial crisis.
Finally, in 2017, Airbus acquired 50.01% of the C Series shares for US$1 and renamed it A220, while Bombardier retained only 31% of the shares.
In order to cope with the financial crisis, it had to sell the Dash8 and CRJ regional passenger jet projects in 2018 and 2019 respectively.
At the same time, Bombardier's railway business also maintained losses in the following years...
The only thing that can make a profit is that it is affected by the global economic recovery. Its business jet sales are not bad, but the global economic recovery has just begun.
Therefore, Barron's acquisition will basically not encounter too many difficulties for Bombardier. The only thing that needs to be resolved is the EU's antitrust investigation.
The EU's antitrust agencies are very cautious in reviewing mergers between "giants" that already have high market shares.
In the original time and space, when Alstom later acquired Bombardier's railway business, the condition in exchange for the EU's approval of the agreement was——
Alstom needs to sell some of its factories. This includes the sale of its plant in Reichsofen, eastern France, as well as the sale of its Coradia Polyvalent series of EMUs and the divestiture of Bombardier's commuter train division and associated production facilities at its Hennigsdorf plant in Germany.
Barron naturally does not want to "dismember" Bombardier's railway business so much, so Britain will need to come forward to convince the EU - and France, where Alstom is located, will also lobby for this.
At this moment when the EU needs internal unity, and Britain and France are trying to protect Alstom at the same time, there is still a high possibility that the EU antitrust agency will let it go.
(End of chapter)