Bombardier's CSeries order likely to eclipse shareholder discord at AGM

By Allison Lampert and Euan Rocha
MIRABEL, QUEBEC/TORONTO April 29 (Reuters) - A major CSeries
order from Delta Air Lines (NYSE:DAL) DAL.N will likely hold investor
attention at Bombardier's BBDb.TO annual meeting on Friday,
overshadowing discord between the company's founding family and
disgruntled shareholders.
Delta's order - the largest yet for the CSeries - is set to
eclipse a mini-revolt by some influential minority shareholders,
including at least three major Canadian pension funds, who are
calling for greater transparency within Bombardier and opposing
tweaks to its stock option plan and other proposals.
The vote of confidence in the troubled CSeries program from
a flagship carrier like Delta is a huge win for the long-delayed
and over-budget passenger jet program. The widely anticipated
order had boosted shares in the embattled company by roughly 50
percent, weeks before it was even inked on Thursday.

The order did not, however, sway the views of a cadre of
vocal minority investors like Canada Pension Plan Investment
Board, Ontario Teachers' Pension Plan and British Columbia's top
public sector pension fund BCIMC. All have voted in favor of a
proposal requiring Bombardier to separately disclose voting
results on all resolutions by class of shares.
The company's founding family have a 53.23 percent voting
stake, largely through the 79.5 percent stake of Bombardier's
Class A multiple voting shares they control. Bombardier's Class
A shares carry 10 votes per share, while Class B shares carry 1
vote per share.
The company's dual-class share structure has faced criticism
in the past, especially given Bombardier's recent missteps.
Bombardier Chief Executive Alain Bellemare said on Thursday
the dual-class structure was a factor in the negotiations over a
$1 billion cash infusion from the Canadian government, but he
defended the family's role.
"People are under-appreciating the value of having a family
that has a long-term commitment to developing an aerospace firm,
which is the anchor of our aerospace industry," Bellemare said
in an interview.
BCIMC was the most scathing of the funds in it criticism and
said it plans to withhold support from all five
Bombardier-Beaudoin family members on the board, as the level of
independence in the boardroom is low.
With the founding family's majority voting control, however,
the noise generated by the pension funds "is all academic," said
Morningstar analyst Chris Higgins. "The family's going to vote
as they see fit," he said. "Maybe this adds a bit of pressure,
but I don't see the family caving on the voting structure and
other issues."