By Jacquie McNish and Benjamin Katz
Airbus SE is in advanced talks to acquire Bombardier Inc.'s remaining stake in a commercial jet family that the Canadian company once said would transform it into a major global aviation player, people familiar with the matter said.
An agreement for the sale of Bombardier's 34% stake in the two companies' joint A220 commercial jet program could be reached as early as next week, ahead of both companies' earnings reports, the people said.
The Quebec government, which holds a 16% stake in the venture, is expected to hold its stake.
Financial terms of the planned sale couldn't be learned. While talks are in final stages, they could still fall apart or the contours of the potential deal could change.
The Montreal plane and train maker has been scrambling to reduce roughly $9 billion of long-term debt, some of which comes due next year. The company is seeking to pare its debts by selling the stake in the Airbus partnership and one of its two other core divisions, people familiar with the matter have said
Bombardier began talks several weeks ago to sell its business-jet division to Textron Inc., The Wall Street Journal reported Tuesday. Those discussions came after negotiations to sell its train unit to France's Alstom SA slowed amid concerns about rising costs and delivery delays at the division.
Much of Bombardier's debt was taken on to finance the company's ambitious strategy to enter the commercial airline market. It formally launched the CSeries in 2008 with the goal of developing an aircraft that could compete with Boeing's 737 MAX and the Airbus A320neo narrow-body commercial planes.
While the jet was lauded by airline customers, sales were disappointing because of concerns about the sustainability of a program that had severely weakened Bombardier's financial condition after years of delays and soaring costs.
Airbus took a 50.01% stake in the CSeries program in July 2018. It paid virtually no cash for the stake but committed to throwing its global marketing heft behind the jet.
Bombardier, meanwhile, committed to covering the program's losses over a set period.
Bombardier said last month that it had started a strategic review of its stake in the Airbus partnership because of the rising losses.
Under the terms of the proposed new stake sale, Airbus would absorb the $350 million in losses that Bombardier was required to cover this year, according to the people familiar with the matter.
After the talks with Textron were reported by the Journal, Bombardier came under political criticism in Quebec for putting up for sale its business-jet division, which received a $1 billion lifeline from the province in 2015.
Bombardier's jet business anchors a thriving aerospace sector in Quebec, employing more than 40,000 workers.
Write to Jacquie McNish at Jacquie.McNish@wsj.com and Benjamin Katz at firstname.lastname@example.org