Bombardier family digs in heels on dual-class shares matter

Bloomberg

Bombardier Inc.’s founding family is rejecting demands by Canada’s government to loosen its control of the company in exchange for financial assistance.
“It’s not our intention to change anything in this regard,” Bombardier Chairman Pierre Beaudoin said in Montreal.
Prime Minister Justin Trudeau’s government is said to be pushing for corporate governance changes, including the dual-class structure that allows the Beaudoin and Bombardier families to control the company. The two sides still aren’t close to a deal, according to two federal officials who spoke on condition of anonymity as talks are private.
The dual class share structure remains at the center of the impasse, one official said. Beaudoin, however, was adamant on that issue.
“The Bombardier family has always sought to ensure the success of the company,” Beaudoin said, alongside Chief Executive Officer Alain Bellemare at the company’s annual meeting. “It was there in good times and in more difficult times. Our multiple voting shares allow us to invest for the long term. They also allow us to protect against the dismantling of the company.” Bellemare again urged Trudeau’s government to invest in the company, saying negotiations are complex and declining to comment on their nature. He said the company would welcome a federal investment in the C Series, which got a boost Thursday when Delta Air Lines Inc. agreed to buy at least 75 of the narrow-body aircraft.
The Quebec government has pledged $1 billion for Bombardier’s delayed C Series program, with both the company and province calling on the federal government to do the same.
“If you look at the impact that the Quebec investment has had on C Series, it has been major. This has really given customers the confidence they needed to buy the aircraft,” Bellemare said.
He added government investment would provide “additional financial flexibility” for Bombardier as it invests in research and development. “It’s good for all of Canada. It creates jobs,” he said.
Speaking in Toronto, Innovation Minister NavdeepBains called the Delta order a “positive” development for the company and declined to comment on Beaudoin’s remarks. Finance Minister Bill Morneau reiterated talks with the aerospace manufacturer are ongoing. “We want to make sure the sector stays strong in Quebec,” he said in Quebec City.