RE:RE:RE:RE:RE:RE:RE:RE:Entreprise familiale Hey Pablo.
I have no doubt that your suggestions on Debt repayment will work under normal circumstances, with a normal company. I never questioned that part of your suggestion.
What I am saying here is, that this company isn't normal. Any company that gives half of $6B away, and then, participates in the Joint Venture to the tune of another $1B to build the program up (Alabama, Mirabel), for their partner Airbus, only to have their partner take the whole program from them for $900M, is not normal. This is what I'm trying to relay to you.
So don't expect anything different going forward.
Your first point is quite interesting in that, yes the competition can view Bombardier as weak carrying so much Debt. But then let them. This company, was always thought of as the underdog, yet they always surprised the competition, hence the CSeries. Who thought that this small company out of Montreal Canada, known for building snowmobiles would be able to build the best airplane in its class, without any Government support. Certainly not Boeing or Airbus. Who dares to do that? After they did it, the only way to stop them was, with Government intervention to sabotage the company, and steal the technology. So to answer your question on your first point. Let the competition underestimate the Bomber with all this Debt. Which btw I see as $3.5Bish as my previous post by 2025. The way I see things here, is very simple. Bombardier's 5 year plan in the building of the new Service Centers, the new manufacturing facility with Pearson, and I'm telling now that St. Laurent is next to be built, they will blow the doors off the competition. Somehow this Pure play idea has given them new hope. They've realized that it's better to stay small (Business Jets) and to be great at what you do, than try to do the impossible, or create a miracle, without assessing your competition first. Let's be real here, who from their competition saw this success in the BJ industry coming from Bombardier?? Certainly not Gulfstream. The Bomber is just starting, in taking away the lost BJ business from them from the last decade. The Bomber had 65% of the BJ business market at one point. Yet they were too engulfed in the CSeries trying to hit a home run, and didn't pay any attention to their BJ's. Well now they're reversing those mistakes with BD & EM.
To your second point. Look you can argue that the reverse is true. Their Debt will keep their suppliers, employees etc feeling sorry for the indebted company and therefore suppliers would charge them less for parts, & employees will renegotiate less for wages, given the size of their Debt. What Honeywell did was illegal & they are paying for what they did. They signed to be the sole and exclusive supplier & they started to sell the enginene development to the Bomber competitors, for cheaper. I'm glad that Honeywell is under the gun right now, because these American companies are stealing everything that Canada has. What happened with Honeywell was that Honeywell helped Gulfstream steal the new Engine, and gave it to Gulfstream for cheaper, and so Gulfstream stole more BJ business, from the Bomber. Honeywell needs to be punished financially for this action.This patern of theft from the US for Canadian resources is diabolical. No wonder Gulfstream is, where they are, in the BJ industry, because Bombardier was too stupid & entranced in their CSeries development to see this coming.
Your third point is interesting. If you think that Institutions, are lining up to lend to the Bomber in these times, I want to hear it? I think not. Besides, why should the Family collateralize the company, or their Personal assets to change the status quo. They don't even want to collateralize the company's assets for loans anymore. Btw, smart move. On another point, why would Bombardier take this jewel (BJ's), and share it again, with Bain Capital, and their favorite BT partner Caisse, like they did with BRP. They are smarter to stay this way, and not take any one as partners, & least of all, try to steal this company away from the shareholders, who have backed them, and endured such financial pain over the years, with this Lousy buisinessman PB running things. They already own 10% of the company, why raise equity to own the same percentage? Look I'm no Stock guru here, and I'm not going to pretend to know how the Market is going to view a smaller Debt, but I hate debt, I'm a businessman that believes in working with good foundations, and make less profit, but do it sure footed. But this share issue will dilute us, if they decide to do it. Especially now that I see the Debt as inconsequential. When it was $10.3BLTD, I we were terrified of Bankruptcy, here, but we're way past the BK stage, and $3.5B of Debt in 2025 will seem even less consequencial, after taking the $1B annual +FCF into account. What I'm saying here Pablo is that they've survived the worse, another 2 years of patience isn't going to hurt them. Even BETTER they won't hurt us the shareholders, by having this Managements focus solely on the Debt, for the next 2 -3 years. These guys always spend more than they have, and the more they have, the more they will spend.
YMMV, as proven, but I'm just glad that you are not selling your shares right now. this is just ,not the time. 2025 for me is closer to the right time. I just hate getting lied to. I don't enjoy theft either, especially in a public company.