Bombardier should face hedge funds’ lawsuit over bond transaction -New York decide
STORY CONTINUES BELOW THESE SALTWIRE VIDEOS
By Allison Lampert and Jonathan Stempel
NEW YORK (Reuters) – A New York state decide on Friday rejected an try by Bombardier Inc to dismiss a lawsuit by a gaggle of hedge funds that accused the enterprise jet maker of short-changing them by promoting new debt after divesting main companies in 2020 and 2021.
Justice Andrew Borrok of the Manhattan Supreme Courtroom stated the hedge funds didn’t waive their proper to declare Bombardier in default on their bonds, a part of a $250 million issuance maturing in 2034, when it offered the companies, together with its industrial plane program.
The hedge funds Antara Capital Grasp Fund, Corbin ERISA Alternative Fund and Corbin Alternative Fund sued Bombardier final January, after the corporate offered an extra $260 million of the bonds to a different investor.
That sale gave the investor a majority of the now $510 million issuance, and it voted to waive the default.
The three hedge funds stated it had no proper to do this. They claimed that the default required Bombardier to pay them $398 million, together with excellent principal plus the current worth of future curiosity funds.
Borrok dismissed a few of the plaintiffs’ claims however stated they might replead them.
Bombardier didn’t instantly reply to requests for remark.
Duane Loft, a accomplice at Pallas Companions who represents the plaintiffs, stated: “We’re happy that the courtroom interpreted the indenture to imply what it says – that these new notes do not depend for functions of waving the previous default.”
Bombardier now focuses primarily on personal jets. Its rivals embrace Gulfstream jet maker Normal Dynamics Corp and Cessna jet maker Textron Inc.
The case is Antara Capital Grasp Fund LP et al v Bombardier Inc et al, New York State Supreme Courtroom, New York County, No. 650477/2022.
(Reporting by Allison Lampert in Montreal and Jonathan Stempel in New York; Extra reporting by Maiya Keidan in Toronto; modifying by Grant McCool)
