Bombardier Inc. T.BBD.A

Better rates ?

[Tempo1]

In december 2023, only 4 months ago, they issued a new debt in US at 8,75% for a 2030 term. 
The most recent trades (secondary market) for Bombardier bonds were around 7 %.
We could anticipate a 7 - 7,5% rate for the new issue.
It's a better reimbursment scedule job.

[PabloLafortune]

It'll be interesting to see what premium they have to pay on the 2026's....what rate they get on the 31's and whether they're callable or not (usuallly not disclosed). Then I'll comment.

[Tempo1]

Not sure I understand . We already have the datas.  The offer for the 2026 is at 101,75  (98,75% + 3 %) and the last trades I saw were near 100,6.  (Frankfurt) They give a 1,25 % premuim.  It's usually callable at least 1 year prior to the term, allowing an easy refinancing before the term. Is it more?, as you I hope so.

[PabloLafortune]

Sorry,didn't realize that. Seems too much, why not just call back the '27s and let the '26's 26 themselves?  After all, the '26 interest rate is lower than the '27's. Not impressed. 

[bbdmic]

They have a plan and they know what they are doing. I will maybe wait after 63.50 to may 1.?  

[BBDB859]

Pablo. I think it has to do with reducing the size of each of these, as oposed to the interest rate. I don't think they'll touch the rest of the 2026, until the end of 2024 with cash on hand. Each the 2026, and the 2027, are way above the $750M that they want all their Junk Bonds to be. So it's not just the interest rate that they weigh in doing this. Yes it's strange that they'

[PabloLafortune]

859, the cost of all of this is at least $13M that I can tell. Before & after interest is a wash but there are fees and premiums to be paid.  Extending debt runway is always good of course especially when youre not generating sufficient cash to pay it off AND if you believe interest rates will rise. I happen to believe they're coming down and will go down further therefore, it would

[BBDB859]

Hi Pablo. There is always a cost for doing business as u know. In this instance they added the 2 Bonds of 2026/7 to total $2.7B. Yet they gotta bring them down to $750M each. They know that they have 2 diferent rates for the 2. Without too much calculation here it's easy to figure out their path on this.They have a plan, they'd like every new issue not exceeding the $750M, so they can pay

[PabloLafortune]

859, very well put: "the cost of doing business".  You are very succinct and to the root of the matter nowadays. Cheers, Pablo. 

[BBDB859]

Thanks Pablo. The fact is that the good posters that remained here, are educated in their way, and informative. The ones that need to be educated are few. So now I spend less energy with them. I only respond to the right posters  cheers

[Tempo1]

They are listening to you.

[Thebomber2023]

Savings on rates will put a smile on the faces of many investors, including myself

[Tempo1]

It is 7,25%. My bet was not so bad at 7- 7,5%.