Bombardier this week reached an agreement to settle a shareholder lawsuit related to its divestitures but said that the terms are confidential. In 2022, Bombardier noteholders filed a complaint before the New York Supreme Court reiterating claims that the Canadian manufacturer violated lending covenants by divesting its transportation business, regional jet program, and aerostructures division.
At the time, the company issued a statement that it “believes that these allegations are without merit and intends to vigorously defend itself against the action. The corporation believes it is not and has never been in breach of any covenant under the relevant indenture and that the actions taken by it in May 2021, with the support and consent of the requisite holders of the relevant debt securities of the corporation, were fully compliant with the terms of the indentures under which such notes were issued.”
The settlement contains a consent from the noteholders "that the divestiture transactions referred to in the lawsuit did not give rise to any default under the Indenture," Bombardier said. "While the company strongly believes the allegations in this case were without merit, it also believes that it is in the best interest of the company and all its stakeholders to settle this lawsuit and concentrate on its core business operations."