dagger Posted April 4, 2003 Share Posted April 4, 2003 Not only is Texas Pacific in talks with AC, so are Onex, CIBC and Ontario Teachers' Pension Fund. Seems AC, once restructured - debt and labor costs - could be a profitable venture for even pension funds again. (Don't forget to negotiate that profit sharing). http://biz.yahoo.com/djus/030404/0047000015_1.html Link to comment Share on other sites More sharing options...
LongTimer V Posted April 4, 2003 Share Posted April 4, 2003 No thanks.I'd rather have the restructuring done and over with.Preferably in house.There's always gonna be scavengers hanging in the wind.Like i said in the past,the government had a major part in this and its time for them to pony up to the table with some realistic help. Link to comment Share on other sites More sharing options...
Guest George Posted April 4, 2003 Share Posted April 4, 2003 the government had a major part in this and its time for them to pony up to the table with some realistic help. What planet are you living on? The Feds have no business in this restructuring, other than to threaten any group with extreme measures if they try to scuttle the deal. You must be a member of IAM, CUPE or CAW, right? Link to comment Share on other sites More sharing options...
Say Altitude Posted April 4, 2003 Share Posted April 4, 2003 WOW! No kidding George! Longtimer - that opinion (respecting it regardless...) is so out to lunch and out of date. You do know that you won't find a shred of support among the general population for this? Nor should there be. If AC lives or dies, the govt should stay out of it. Someone else's failure is anothers opportunity. The market will balance it all out. Link to comment Share on other sites More sharing options...
LongTimer V Posted April 4, 2003 Share Posted April 4, 2003 So what you guys are telling me is that the government did not have any involvement with Schartz and Onex when this all started.You guys really should get your head out of the sand.Its funny when Canadian was going under there was no shortage of bleedy hearts.I guess people just hate the big guys. Link to comment Share on other sites More sharing options...
LongTimer V Posted April 4, 2003 Share Posted April 4, 2003 The feds have no business eh.Hmm..is your memory so short that it was the government and Onex that started this whole mess.You have to stop getting all your info from the Toronto Sun.Oh you forgot to include ACPA ALPA,maybe you didn't. Link to comment Share on other sites More sharing options...
Guest Operation Bomberclad Posted April 4, 2003 Share Posted April 4, 2003 In response to the screaming headline: No Bailout For Air Canada, I would like to point out that the Export Development Corporation has doled out about $8 billion in funds to support foreign airline's purchases of Bombardier products. They also bailed out Nortel massively with injections of billions. Nortel is the biggest corporate loser in Canadian History. So what you have is no money for Air Canada, but endless sums for foreign carriers and their investors who profit directly, or a prop up of Nortel or Bombardier, but not Air Canada which is pretty essential to the economic functioning of this country. I would say anyone promoting the demise of Air Canada, probably has staked their future on the stock price of low-cost carriers, assuming that the "dinosaurs" will simply disappear and that they cannot remake themselves during bankruptcy. The Canadian taxpayers are getting off relatively cheaply if the government ponies up anything less than a couple of billion. I guess they must like Nortel or Atlantic Coast Airlines Holdings as the focus of their tax dollars and support this kind of blatant bailing out much more than that of their national carrier. That being said, I would agree that mothercorp management along with their pilot bed-partners should be trucked down to the corner of Bay & Young for a severe pants-down ass-paddling. Link to comment Share on other sites More sharing options...
dagger Posted April 4, 2003 Author Share Posted April 4, 2003 It doesn't matter what happened two, five or 10 years ago. Just as I have urged AC and CP people to forget red and blue days and who did what to whom, it should be clear that it is time for AC to look forward, not backwards. As much as I would like to see Canada have a strong international airline, for reasons I have enunciated many times, I believe that AC must do it entirely on its own. Government is poison to the industry and especially Air Canada. It has its paws all over policy in ways stupid and sublime. If AC takes federal money - unless it is doled out to all airlines in the form of tax and fee reductions - it will never be free to operate profitably. It would be like a form of permanent trusteeship. I have to say that while the government and many Canadians keep calling AC a private company, they keep treating it like a ward or offspring of the state, loading it down with special rules and obligations and making it a personal whipping boy for sorry åss politicians on their soap box. My view is that Air Canada is infinitely better off if it rejects every conceivable form of special treatment, good or bad, from government. I would rather see AC liquidated than having to reorganize with these piddling government loan guarantees that were offered with numerous strings attached. So, restructuring should be 100% privately financed. Or bust. Nothing less. Not a dime of special government aid because aid like that is a poison pill. Air Canada should also insist that it be treated the same as other airlines. It no longer has the market share, or legal monopoly on any single route. We have domestic deregulation, Canada-US open skies, and a new federal policy on international flying that allows other Canadian carriers very liberal access to international routes. Tha'ts good. But the feds should also put Ac on the same competition law footing as other airlines, should abolish the Air Canada Privatization Act and all of its throw-back obligations. Air Canada should have no more requirements for bilingual operations than other Canadian airlines, etc. As for access to capital, LongTimerV, AC will need significant new equity capital to come out of bankruptcy protection. That's what this lineup of companies - Onex, Marathon, Texas Pacific, Ontario Teachers' Pension Fund, CIBC - looking to invest is all about. Who would you rather have on your board? A meddling, destructive Liberal government who loves having AC as a whipping boy, or Texas Pacific, an experienced airline makeover investor, the company which joined with Air Canada in 1994 to turn around Continental Airlines? Would you rather have some old Liberal hack on your board, or the Texas Pacific people who know the business and will be dedicated to making AC the biggest success possible because it's good for their investment? To me it's a no-brainer. Even Onex is shrewder and profit driven. Government profit-driven? There's an oxymoron. All the government wants is to make sure there are no withdrawals from unprofitable services before an election so no Liberal candidates have to face embarassing questions from constituents. I would rather see Air Canada die and an all-new international carrier emerge over time- free of unions and above all free of government - than see this government keep its Sword of Damocles hanging over AC. So let the private interests save AC, or LIQUIDATE. I'm quite comfortable with that from a strategic point of view. Private capital is obviously there, and not fly by night money either. Firms like Texas Pacific and Onex are turnaround specialists. Teachers Pension Fund is a shrewd investor in ongoing businesses. These are not companies or investors that come to stripmine the company of its assets. They won't be running fire sales. Link to comment Share on other sites More sharing options...
CAT3DUAL Posted April 4, 2003 Share Posted April 4, 2003 Agree with your post a 100%. But what has changed, as soon as AC gets itself back on it's feet, what will prevent the government from again using AC as instrument for government policy. As a investor, I would not touch this with a 10 foot pole, after what I've seen the government do to it in the last five years. We are hand cuffed by government policy, both by the Air Canada Act, as well as policy that changes as the need a rises. Unless these new investors know more then I know, (not hard) I frankly don't know what has changed! Inlighten me, please. Thx in advance. CAT3DUAL Link to comment Share on other sites More sharing options...
dagger Posted April 4, 2003 Author Share Posted April 4, 2003 You would have to define instrument of policy. There are no more requirements to maintain rural or remote services. This is good. Let the marketplace - smaller airlines - do that. The government wanted to reimpose that condition to maintain money-losing rural services as part of a bailout package. AC said no. AC can keep saying no, and I don't see how it can be singled out for new obligations. The risk is that if AC says yes to special government help, it puts the relationship back to where it was at the time of the merger. In time, I believe AC should be able to make a strong public case to have all government. laws, rules and regs which single out AC abrogated or abolished. I'm pretty sure, however, that the Montreal headquarters rule, and the bilingual requirement, will be the last to go. Link to comment Share on other sites More sharing options...
Say Altitude Posted April 4, 2003 Share Posted April 4, 2003 Apologies kind sir, I do know the difference between yourself and Longtimer V. Just some haste in writing my response! ( on the house for my slip up. SA Link to comment Share on other sites More sharing options...
Say Altitude Posted April 4, 2003 Share Posted April 4, 2003 Sword of Damocles - GREAT cryptic reference! I'm laughing my a$$ off - but your point is made! (y) - cheers! (d) Link to comment Share on other sites More sharing options...
Guest George Posted April 4, 2003 Share Posted April 4, 2003 it was the government and Onex that started this whole mess Exactly, so why do you think they are qualified or capable to clean it up???? GG Link to comment Share on other sites More sharing options...
Guest Max Continuous Posted April 4, 2003 Share Posted April 4, 2003 >> The government wanted to reimpose that condition to maintain money-losing rural services as part of a bailout package. AC said no. << You mean Air Canada had a CHOICE to say no before, at the time of the merger ? Link to comment Share on other sites More sharing options...
Guest GDR Posted April 4, 2003 Share Posted April 4, 2003 Hi Dagger Thanks for your insights. Can you give us an idea of how you see this airline being structured financially after this is all over. Early on you gave an opinion that the company had a 50/50 chance of emerging from this. In lieu of what you have posted on this thread has that assessment changed? Thanks Greg Link to comment Share on other sites More sharing options...
LongTimer V Posted April 4, 2003 Share Posted April 4, 2003 Like i said,they should still be at the table.Maybe now would be a good time to assist in getting the most senior out the door.Less layoffs more younge people working.Otherwise we'll all be on U.I.Last time i checked there was a $30 Billion surplus,which we all paid into. Link to comment Share on other sites More sharing options...
Guest George Posted April 4, 2003 Share Posted April 4, 2003 If you think 48 weeks @ $400/week maximum is adequete then you go right ahead and demand that the Feds get their noses back in. DC is too busy cleaning the mess from his trousers to worry about helping out. Link to comment Share on other sites More sharing options...
LongTimer V Posted April 4, 2003 Share Posted April 4, 2003 Lets be realistic.The government will never totally let go of Air Canada.There's to many far reaching places in this country that Air Canada will be forced to fly.Why do you think WestJet and others only fly where they can make a buck.Air Canada will never have that option,so with that being said the government has a obligation to help Air Canada now because what you suggest will never happen. They will not let go.Look at the laws that were inacted just for Air Canada Link to comment Share on other sites More sharing options...
dagger Posted April 4, 2003 Author Share Posted April 4, 2003 The obligations arising from the merger were made/imp[osed as the result of a specific business combination which some would have otherwise deemed anti-competitive. Those conditions no longer apply, so unless the government wants to buy Air Canada and run it as it did in the 1940s, 1950s, 1960s and 1970s, namely as an instrument of public policy, it will have no leverage with Air Canada to provide those services. If it decides it wants to buy AC, it will have to make the best offer to the creditors, because many of them are foreign and couldn't give a rat's åss about the Liberal government's political needs. As I will conmtinue to say time and again, the government shouldn't rescue Air Canada, it won't rescue Air Canada, and Ai Canada and its employees are better off for it in the long run. Link to comment Share on other sites More sharing options...
dagger Posted April 4, 2003 Author Share Posted April 4, 2003 Have I changed the odds on restructuring succeeding? Not at all. Not until the unions have agreed to their haircut. The unions can sit back and do nothing, in which case the would-be investors will show no interest, and the creditors will liquidate. One wolud think that there will be enormous pressure on the unions from within to accept some sort of haircut. But it is also possible that you will be sacrificed on the altar of union ideology, that the Hargroves and Darcy's of the world will fear the precedent for making such sweeping concessions. So 50-50 it is until there are signs of movement on the labor front. If nothing is moving after two months, the odds on liquidation rise to 60-40 and continue to increase each month after that until the orderly shutdown process is decreed by Mr. Justice Farley. Link to comment Share on other sites More sharing options...
Guest George Posted April 4, 2003 Share Posted April 4, 2003 I am sure the timelines will be a lot quicker than that Dagger. My opinion and 99¢ will get you a coffee at Tims (HST not included) Link to comment Share on other sites More sharing options...
Guest GDR Posted April 4, 2003 Share Posted April 4, 2003 If there is one or maybe even two union hold outs can't the courts force a solution on the hold out union? Link to comment Share on other sites More sharing options...
Frosty Posted April 4, 2003 Share Posted April 4, 2003 It would be nice to see , if the playing field was the same for all the airlines in Canada. But I guess that in one way JC is getting his legacy through his government, that he has effectively screwed up the transportation policy of this country for years to come. Heard on the news the other day that they are touting Stan Keyes as the next Transport Minister when Paul Martin sits in the premiers chair.....maybe we should all start writing letters to him and forget about Colanhead. Link to comment Share on other sites More sharing options...
LongTimer V Posted April 4, 2003 Share Posted April 4, 2003 Dagger i understand what your saying.My question to you is,knowing the track record of this government do you honestly believe that they will keep their grimy little hands off.I don't.So if thats the case then they should pony up to the table,if their gonna screw me anyways why not get at least a kiss Link to comment Share on other sites More sharing options...
Guest leftbase Posted April 5, 2003 Share Posted April 5, 2003 "The Canadian taxpayers are getting off relatively cheaply if the government ponies up anything less than a couple of billion." A couple billion here, a couple billion there...pretty soon we're talking real money... Past government waste, such as Nortel - an excellent example - do not justify a repeat with AC. Good money after bad. Link to comment Share on other sites More sharing options...
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