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Bombardier and Adtranz (A)

Subject

Marketing

Publication Year

2005

Abstract

On April 30, 2001, Bombardier announced that it had completed the acquisition of DaimlerChrysler Rail Systems GmbH (Adtranz) for a cash consideration of Cdn$1.1 billion (US$735 million). The transaction made Bombardier the world leader in rail vehicles, matching the company’s status in regional jet aircraft. In making the announcement, Bombardier, Inc., President and chief executive officer, Robert Brown commented: “The combination of Bombardier Transportation and Adtranz will position the new entity among the industry leaders in all activities related to the production of rail vehicles in world markets…This acquisition complements our transportation activities in terms of geographical markets, products and services, broader capabilities, expertise and assets.” Although Bombardier had an enviable track record of successful acquisitions to draw upon, Adtranz looked like a particularly difficult test. Not only was Adtranz a loss making company with little operational discipline and a history of suffering from corporate neglect, it also counted 25% more employees than the transportation division of Bombardier into which it would be fused. Some analysts wondered if the new challenge was not too great: 36,000 employees, the remains of 40 different corporate identities, 13 languages of communication, 56 manufacturing sites in 22 countries, and over 800 separate projects, most of which involved multiple sites.

Topic List

Rail Industry, Transportation

Industry

Rail Transportation

LBS Case Number

CS-05-002

Project Funder

Marie Curie

Supervisor

Korine, H

Available on ECCH

No


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