Bombardier - Executive Advisor, Christophe Degoumois
Executive Advisor, Christophe Degoumois
Source: Bombardier.
  • Bombardier (TSX:BBD) has redeemed all of its outstanding US$380 million aggregate principal amount of its 7.50 per cent senior notes due 2025
  • The company had announced that the redemption price is 100 per cent of the principal amount redeemed, plus accrued and unpaid interest
  • When senior notes, which are a common way for companies to borrow money with lower interest than other kinds of debt, are redeemed for company shares, they reduce the businesses’ debt obligations
  • Bombardier stock opened trading at C$47.77 per share

Bombardier (TSX:BBD) has redeemed all of its outstanding US$380 million aggregate principal amount of its 7.50 per cent senior notes due 2025.

The company had announced the redemption price is 100 per cent of the principal amount redeemed, plus accrued and unpaid interest.

Senior notes are a type of bond that have priority over other debts in case a company declares bankruptcy. While they have a lower degree of risk compared to stocks, senior notes often also pay lower rates of interest.

Senior notes are a common way for companies to borrow money with lower interest than other kinds of debt. When notes are redeemed for company shares, they reduce the businesses’ debt obligations.

Montreal-based Bombardier is a global aviation company focused on the design, manufacturing, and servicing of business jets. It has approximately 5,000 aircraft in service across multinational corporations, charter and fractional ownership providers, governments, and private individuals. Bombardier aircraft are also used in government and military special-mission roles across the world.

The company made news this week declaring plans to sell a militarized version of jets to other countries after publicly expressing its disappointment in the Canadian government’s decision to award a generational contract to Boeing Co. (NYSE:BA) for 16 of its P-8A Poseidon aircraft as part of the Canadian Multi-Mission Aircraft project. Bombardier stated this was done without an open and fair competition and without fully evaluating its home-grown industry’s multi-mission aircraft capabilities.

Speaking on behalf of GDMS-C employees, political and industry leaders, and suppliers, Bombardier’s open letter said the solution the company was ready to present would have been “a game changer for the Canadian economy.”

Bombardier stock opened trading up 0.70 per cent at C$47.77 per share. Its stock has added 1.85 per cent in the past week but is down 7.64 per cent this year. Over the past five years, the stock has grown more than 2,000 per cent.

Join the discussion: Find out what everybody’s saying about this Canadian aviation stock on the Bombardier Bullboard, and check out the rest of Stockhouse’s stock forums and message boards.

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