Bombadier announced its $2-3 billion CS100 deal knowing the deal is and remains unfunded

Bombadier Inc , a company listed on the Canadian Stock Exchange, presumably in the interest of keeping the market fully informed, announced on  17 March 2015:
Bombardier Commercial Aircraft and Fly Mojo Sdn Bhd announced today that the parties have signed a Letter of Intent (LOI) for the sale and purchase of 20 CS100 aircraft with options for an additional 20 CS100 aircraft.Based on the list price of the CS100 aircraft, a firm order would be valued at approximately $1.47 billion US, and could increase to $2.94 billion US, should flymojo exercise all its options.

Flymojo is , in relative terms, nothing more than a shell, with a paid-up capital of only USD 1.million, and nothing else. When asked about its funding for the deal the company first claimed to be backed by private equity, but then under interrogation said:
"flymojo is working alongside Bombardier and third parties to source potential financing solutions."
It appears then that Bombadier has made its announcement knowing that the deal is unfunded. It might as well have announced that it was buying Airbus and Boeing all at once. Bombadier and Flymojo initially gave the impression that Flymojo's private equity backers would fund the deal. However, when it was put to company spokeswoman Tan Wai Fun that the size of the deal would require an injection of capital that would in essence swamp the interest of existing shareholders to next to nothing, Ms Tan responded:

I checked, and noted my mistake in the response to the question on aircraft funding.
My apologies for that - the correct response is:
"flymojo is working alongside Bombardier and third parties to source potential financing solutions."
In fact,Ms Tan made no mistake. Managing director, Datuk Janardhanan Gopala Krishnan, told Malaysia's Sun Daily that the company is backed by private equity funds,"   and   "will look into sale and leaseback of aircraft of its fleet in a bid to keep the company asset light." 


It is clear from the differing accounts from the company's CEO and its spokeswoman that the deal is unfunded, and that Bombardier is aware of the fact. Announcing a deal of the given magnitude knowing it is yet to be funded, with a client that is little more than a shell, must cause Canadian regulators some concern.END 

Comments

Post a Comment

Popular posts from this blog

"Not new or worthy of consideration" : WA Corruption & Crime Commissioner confirms but dismisses Anne Azza Aly 's referring queries about PAVE, her work to Malaysia

Image
by Ganesh Sahathevan       John McKechnie The issues raised on my related RealpoltikAsia blog in the posting:  ALP's Anne Aly's Phoenix Consulting of Dubai provides covert intel training-Who does she report to in Dubai, and then there is the matter of Malaysia....... were brought to the attention of The Hon John McKechnie QC,the current Commissioner, WA Corruption and Crime ,given the security implications that arise from the connections between PAVE and one David (Dave) Allen, currently Assistant Director Intelligence,WA CCC. McKechnie's response is as follows: Thank you for the email. I am the Corruption and Crime Commissioner. I will decide if and when Mr Allens security clearance should be reconsidered but nothing in this email is either new or worthy of consideration. The Hon John McKechnie QC Readers have now confirmation from no  less a personage than the WA CCC Commissioner himself, a former judge and QC,of the fact of Aly's Dubai connection, and her ref...
Read more

If Damien Tudehope's COVID hotel quarantine fee statements are correct, SLHD revenue reported in financial statements signed by former CEO Teresa Anderson is overstated, and false

Image
 by Ganesh Sahathevan                     Tough talking Damien Tudehope may not have the power to impose th.  bulk of his quarantine fee, if any Readers will recall that former NSW Police Commissioner Mick Fuller (now a PwC partner) said in his notice that Revenue NSW " will be charging a mandatory quarantine fee". Readers will also recall that the rormer NSW Minister For Financial Services, Damien Tudehope insisted that the quarantine fees charged by Sydney Local Health District, pursuant to the NSW Health Services Act include charges for police security. However, there is nothing  in the SLHD's financial statements for the relevant periods (see links below) to reflect any payment from the COVID quarantine fee revenue being made over to NSW Police. SLHD's revenue must then have been overstated, by the CEO concerned Teresa Anderson.  SLHD Financial Statements https://www.health.nsw.gov.au/annualreport/Publicat...
Read more

Strata managers' aversion to contact with tenants can leave strata managers exposed to personal liability

Image
 by Ganesh Sahathevan      Advice for living in, or buying into, a strata community Strata managers are employed to manage strata schemes which are often home to renters as well as owners. However, in evasion of that which they are paid to do there are instances where strata managers have attempted  to evade their duties by refusing to  deal with tenants.   Even this writer can recall an instance where the strata manager warned that it was against the law for tenants to contact him directly.  The instances where strata managers have refused to deal with tenants occur when the issues raised concern fairly pedestrian maintenance issues, for example blocked plumbing and the like. Having said that, tenants do actually have a legal right to a great many things, including being informed (and presumably make representations) when strata schemes consider re-development. Strata managers who seek to stand in place of strata committees  are even more e...
Read more