Bombardier Inc. T.BBD.A

WTF are they doing?

[mnztr]

They borrowed money at 7.25 to pay back debt at 5.25 and just paid of some debt and are now borrowing 1.2B?  Seems all pointless and a waste of energy to me. The 1.2B issuance tells me they expect to keep bleeding for quite a while still.

[stockitnow]

They borrowed money at 7.125% which is due in 2026 to pay notes due in 2022 and 2023 which had rates from 5.75% to 6.125%. While its higher this is probably the best going rate that Bombardier could get. In simpler view i see it as no different then looking to renew your mortgage rates. While it will cost bombardier more in interest, it has also addressed 2022/23 bonds and it doesn't have to

[mnztr]

Why did they buy back all that expensive debt earlier instead of waiting to take out these redemptions when they expired? It all seems a but whacky to me. Maybe there were covenants they were in violating with the sale of Transport?

[lb1temporary]

No, If so, that has been fixed by the sollicitation of concent achieved two weeks ago.

[stockitnow]

You know the answer and it has been discussed on this board and by analysts. There is nothing wacky. One bond holder was complaining after the sale was completed. They had plenty of time to bring this up before the deal closed. Their plan back fired to black mail bombardier. Bombardier clarified and gave incentives to those who agreed. Again it brought stablity and at that time the sp stayed put

[Shamhorish]

yes, it make sense, and by end of 2022, 2023, (if bbd shows good Quarters result) and more money coming in from maitenance facilties >>>>>> better financial>>>>>> better credit Rating >>>> may be somewher in 2023 bbd can get loans at 4-5% and pay 2024,2025,2026 and then bbd.b will skyrocket  lot of may be s>>>>>> but it may

[mnztr]

That was a seperate issue they bought 1B worth if 6.25 bonds expiring in 2023. So why would they spend 1B to retire 6.25 bond that are good for 2 years and then issue 7,25 bonds?

[Acuras1]

When your balance sheet is more solid and you have demonstrated you can execute on what you've promised, generate lots of FCF and maybe even a profit, you can wait your renewal debt obligations because you can always get cheap and bountiful money. In current circumstances and despite lots of hope, management chose to extend another 3 years at a rate which reflects the company's credit

[300australian]

All is setup for the new buyers. Probably the capital will be closed by bombardier Family or sell to an other bombardier family compagny.

[bicente]

Watch out , some guys on here might accuse you of " just speculating " and " not providing enough facts " ... the fun is about to begin ... GLTA quote=300australian]All is setup for the new buyers. Probably the capital will be closed by bombardier Family or sell to an other bombardier family compagny. [/quote]

[BBDB859]

Hey Mnztr. I know it seems wacky that they are renewing the Bonds now instead of wating for them to get better or closer to maturity.  The reason for that is that they are getting better or good rates right now. They were getting 8.75% for these same JB's just a year ago. This 7.1% is still 1.6% below those. Plus remember that the're credit rating may or may not get any better next

[mnztr]

I suppose that makes sense, rates are low right now and if they hit any bumps in the plan, they may face extortionate CCPDQ rates again. Those guys really shafted them HARD.

[Micmar]

You are right about that! as big as a train!

[BBDB859]

Btw. Did you notice something? Everytime the Bomber does a transaction it's always a $400M transaction. - The cashburn of Q1 was for $400M -The Closing Funds that are in dispute with Alstom was for $400M. -The security they posted to the Bank as colleteral that they're trying to free up $400M. Btw, the banks don't take cash for colleteral. WTF is up with that? I hope all these $400M

[clubhouse19]

Why don't you send an email to the bomber..I am sure they may well answer your question out right.

[lb1temporary]

It's not so simplistic. BBD is a CCC rated company; a very low rating. They have a lot of work to do to become a safer company and that takes time.  By the refinancing they gave them fresh air and time to achieved thier goals.  It's a great achievement and a proof of confidence by the bond market to be able to borrow, by an unsecured bond 1,2B$. The 7,2% interest rate (issued at

[clubhouse19]

That's exactly as it should be seen.\ They need some breathing room before all those notes become due just like any other business needing moneys to fulfill their business plan especially, like is being seen their Expansion of the highly profitable servicing sector.

[flamingogold]

It's a well known fact that the repair shop keeps the doors open for car dealerships, not the actual selling of cars. It would be no different for BBD. While the focus is on the number of delivered jets right now, ultimately the path to juicing profits will be the maintenance and repair of the fleet in the field. A few % points now more in interest is more than worth it to get to that juicier

[PabloLafortune]

Precision Drilling is a well managed company and they did the same thing as BBD with one added twist: they're going to leverage the secured credit line - I'm hoping BBD will do the same (I assume with the bond consent agmt the stage is set). Well BBD could do one better actually.

[BBDB859]

You're a real Precission Drilling fan. I rode PD from $7 bucks to $55 once way back if I remember correctly. I did really well. But then they oil industry got destroyed and they dropped to half of the rigs they had. GL with PD pablo.

[PabloLafortune]

859, small $$, great FCF, CFO is top notch. Stock rocked after the refinancing but credit lines were already in place - that's the piece of the puzzle Demosky hasn't put in place yet.