Bombardier Adtranz
Case BOMBARDIER /ADTRANZ
Question 1
Two very important reasons for an acquisition are:
1 Possibility to expand internationally;
2 The potential to transform a company and to enrich a firm.
What is the Why Rationale?
With the cross border acquisition of Adtranz by Bombardier Inc. (BBD) it enabled Bombardier Transportation (BT) - a division of BBD - to enter the local European markets, obtain know-how and access to European engineering concepts needed in emerging markets like Asia and South America and other markets or influential groups demanding European equipment and technology. Apart from this, it would clearly strengthen BT¡¦s global reach.
With this acquisition it wanted to balance revenue streams in the different groups within BBD and to create a healthy balance against BBD Aerospace Group.
BBD is a Canadian corporation engaged in design, development, manufacture and marketing in the aircraft, rail transportation equipment and recreational product industries. In addition, the company offers services related to its core products and core businesses and is, through subsidiaries, involved in financial services and the development of real estate interests. Although BBD¡¦s acquisition strategy was focusing to complement or strengthen businesses, they had been growing predominately through acquisition of companies in poor shape. They have been very successful in turning around companies with poor performance by implementing tight controls. BBD was also strong in product costing and tendering, as opposed to Adtranz.
ADtranz, which is wholly owned by DaimlerChrysler AG, is engaged in the manufacture and distribution of rail transportation vehicles (Propulsion Systems and Train Controls). Its current activities cover the manufacture and sale of rolling stock equipment as well as fixed installation and signalling equipment.
Although the turnover of Adtranz was in excess of $ 3.3 billion, Adtranz was not the core competence of DaimlerChrysler. Adtranz
Question 1
Two very important reasons for an acquisition are:
1 Possibility to expand internationally;
2 The potential to transform a company and to enrich a firm.
What is the Why Rationale?
With the cross border acquisition of Adtranz by Bombardier Inc. (BBD) it enabled Bombardier Transportation (BT) - a division of BBD - to enter the local European markets, obtain know-how and access to European engineering concepts needed in emerging markets like Asia and South America and other markets or influential groups demanding European equipment and technology. Apart from this, it would clearly strengthen BT¡¦s global reach.
With this acquisition it wanted to balance revenue streams in the different groups within BBD and to create a healthy balance against BBD Aerospace Group.
BBD is a Canadian corporation engaged in design, development, manufacture and marketing in the aircraft, rail transportation equipment and recreational product industries. In addition, the company offers services related to its core products and core businesses and is, through subsidiaries, involved in financial services and the development of real estate interests. Although BBD¡¦s acquisition strategy was focusing to complement or strengthen businesses, they had been growing predominately through acquisition of companies in poor shape. They have been very successful in turning around companies with poor performance by implementing tight controls. BBD was also strong in product costing and tendering, as opposed to Adtranz.
ADtranz, which is wholly owned by DaimlerChrysler AG, is engaged in the manufacture and distribution of rail transportation vehicles (Propulsion Systems and Train Controls). Its current activities cover the manufacture and sale of rolling stock equipment as well as fixed installation and signalling equipment.
Although the turnover of Adtranz was in excess of $ 3.3 billion, Adtranz was not the core competence of DaimlerChrysler. Adtranz