Bombardier says Pierre Beaudoin is planning to relinquish his executive role with the company as of June 30 but remain chairman of the board of directors and continue to work with the company’s management.
Bombardier (TSX:BBD.B) says it expects that change will be formally approved by its board of directors following today’s annual general meeting, which is expected to be the focus of public protests and shareholder displeasure.
Five of Canada’s largest pension fund managers, along with several large American institutional investors, have said they won’t support the re-election of Beaudoin, whose family controls the company through multiple-voting shares.
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They will also oppose Bombardier’s (TSX:BBD.B) executive compensation plan and some will withhold votes for several director nominees.
But the shareholders vote is only an advisory to Bombardier’s board and the founding family, which includes Beaudoin, controls 53 per cent of votes despite owning only 13 per cent of outstanding shares.
The company said today that “Beaudoin intends to step down as executive chairman of the board effective June 30, 2017. Mr. Beaudoin will continue to serve as non-executive chairman.”
“This change reflects the very successful transition of Bombardier’s executive leadership to Alain over the past two years,” Beaudoin said in the statement.
Beaudoin said he supports the management team led by Alain Bellemare, who replaced him as president and CEO in early 2015.
Bellemare said the company continues to “gain momentum as we execute our transformation plan and begin to unleash the full value of the Bombardier portfolio.”
Bombardier Inc. also revealed early Thursday that its first quarter revenue was down nine per cent from the same time last year, but its loss for the three month period has been reduced to US$31 million.
Bombardier’s original plan was to award Beaudoin and its top five executives compensation hikes of nearly 50 per cent. Beaudoin later renounced the increases while other executives postponed the compensation plan by a year until 2020 after the company faced an outpouring of anger that included protests outside the company’s Montreal headquarters.
That came after the company received assistance from the federal and Quebec governments totalling nearly US$2 billion over the past year.
The Canada Pension Plan Investment Board, Caisse de depot, Ontario Teachers’ Pension Plan, British Columbia Investment Management Corp., Alberta Investment Management Corp. and the Quebec Federation of Labour’s Solidarity Fund have said they will oppose management of the family-controlled company.
Bombardier’s first-quarter report says the company, which reports in U.S.. currency, had $3.58 billion revenue in the first quarter, a $31 million net loss or two cents per share and $2 million or adjusted earnings.
That compares with year-earlier revenue of $3.91 billion, a $138 million net loss and adjusted loss of $34 million.
