MONTREAL — Bombardier says it will set up its rail division as a separate publicly traded company while retaining majority ownership.Bombardier Transportation is one of the world’s largest suppliers of subway, streetcar and other rail equipment for mass transit systems and accounts for about half the parent company’s overall business.There has been public speculation for months that Bombardier Transportation could be sold as part of a strategic review announced after its Montreal-based parent installed a new leadership team.Bombardier Inc nears deal to build US$1.5 billion monorail near Cairo, EgyptChinese acquisition of Bombardier Inc Transportation would face significant oppositionTwo Chinese rail giants said to be mulling a controlling stake in Bombardier’s train businessBut the company’s new CEO said Thursday that the rail unit will continue to be controlled by Bombardier Inc.“Let me be very clear: Bombardier Transportation is not for sale,” Bombardier chief executive Alain Bellemare said in a statement.“We like this business and it will remain part of Bombardier Inc.”Details of the proposed initial public offering for Bombardier Transportation weren’t disclosed in Thursday’s financial report but the company said it expects the IPO to take place in the fourth quarter of this year.In the first quarter of 2015, Bombardier Transportation produced US$2.04 billion of revenue — reported in U.S. currency — down 10 per cent from $2.27 billion a year earlier, according to results issued Thursday.Overall revenue for Bombardier Inc. (TSX:BBD.B) was $4.4 billion, essentially unchanged from the first quarter of last year, as the different segments of its aerospace business showed revenue growth that offset the decline in its rail division.Bombardier Aerospace has been struggling to launch the CSeries, a new generation of passenger jet for commercial airlines that’s undergoing test flights prior to going into commercial service. First deliveries of the CS100 are slated to begin in the first half of 2016 to a subsidiary of Lufthansa.Meanwhile, Bombardier said more layoffs are likely in its business aircraft division as it plans to reduce production due to dropping demand, especially from Latin America, China and Russia. In January, the company cut 1,000 jobs in Mexico and Wichita, Kan., after pausing development of its Learjet 85.Net income for Bombardier as a whole was $100 million or five cents per share, down from $115 million or six cents per share a year earlier. Adjusted earnings rose to $170 million (nine cents per share), up from $151 million (eight cents per share) a year earlier and four cents higher than an estimate from Thomson Reuters.Bombardier shares were up in early trading Thursday, rising about 2.5 per cent from the previous close. Bombardier is the only global company to operate in both the aerospace and rail industries.