By Fergal Smith
TORONTO (Reuters) - Bombardier Inc shares extended their recent losses to hit a four-month low on Monday following a report that the train and plane maker likely will lose out to Alstom SA in a rail deal with Siemens AG.
The Canadian train maker had been reported this summer to be in the final stages of talks with Siemens to combine their rail operations, a deal that would have given Bombardier added heft to compete with China's CRRC Corp Ltd.
Bombardier's stock fell as much as 8.1 percent to hit its lowest since May 18 at C$2.05 in Toronto.
Sources have told Reuters that Siemens sees Alstom as more financially stable than Bombardier and that the Canadian company also would have wanted to have control over a transportation joint venture, which Siemens was reluctant to cede.
If Siemens merges with Alstom, "that's going to create a very powerful global competitor (for Bombardier) with better scale, a better balance sheet," said Lorne Steinberg, president, Lorne Steinberg Wealth Management Inc in Montreal.
"It throws into question the viability of (the transportation) division with Bombardier ... which has historically suffered from low margins to begin with," Steinberg added.
The company is also awaiting a U.S. trade court's preliminary ruling, expected to be made public on Tuesday, on Boeing Co's complaint that Bombardier is dumping its new CSeries passenger jet in the U.S. aircraft market.
(Reporting by Solarina Ho and Fergal Smith; Editing by Chizu Nomiyama and Meredith Mazzilli)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)