Fitch rates Bombardier notes BB+

Fitch Ratings said it expects to assign a rating of BB+ to Bombardier Inc.'s planned issuance of at least $1 billion of senior unsecured fixed-rate notes with maturities not to exceed 10 years.

The outlook is negative.

The company terminated its previous planned debt offer and related tender offer due to unfavorable conditions in the debt capital markets, Fitch said. But, it announced new debt and tender offers that are similar to the previous offers.

The ratings are supported by its business diversification, leading market positions and a large backlog that helps to reduce the near-term impact of order volatility, Fitch said.

Over the long term, the company is focused on building a stronger capital structure and further reducing leverage, which would help reduce its cost of funds and improve the company's financial and strategic flexibility, the agency said.

The negative outlook incorporates weak demand in the company's business jet market and pressure on free cash flow in 2011, Fitch said.

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