Employee Purchase of AC
#1
Original Poster
Join Date: Jun 2003
Location: YEG
Programs: AC*E75
Posts: 885
Employee Purchase of AC
I have not seen this mentioned anywhere, but why don't the employees buy AC for the same $650 million that Li was willing to pay, they may even get it for less knowing about the pension problems Li had
If there are 40,000 employees it would only take $16,250 to come up with the $650 million, then the employees could run the shop and prove to the other shareholders and creditors that they can do it better. I have my tongue in cheek a bit here but I knbow it has worked in other businesses, so why not here?
Any thoughts?
If there are 40,000 employees it would only take $16,250 to come up with the $650 million, then the employees could run the shop and prove to the other shareholders and creditors that they can do it better. I have my tongue in cheek a bit here but I knbow it has worked in other businesses, so why not here?
Any thoughts?
#2
Join Date: Apr 2000
Location: Mississauga Ontario
Posts: 4,089
Originally Posted by 7E7
I have not seen this mentioned anywhere, but why don't the employees buy AC for the same $650 million that Li was willing to pay, they may even get it for less knowing about the pension problems Li had
If there are 40,000 employees it would only take $16,250 to come up with the $650 million, then the employees could run the shop and prove to the other shareholders and creditors that they can do it better. I have my tongue in cheek a bit here but I knbow it has worked in other businesses, so why not here?
Any thoughts?
If there are 40,000 employees it would only take $16,250 to come up with the $650 million, then the employees could run the shop and prove to the other shareholders and creditors that they can do it better. I have my tongue in cheek a bit here but I knbow it has worked in other businesses, so why not here?
Any thoughts?
#3
Join Date: Oct 2003
Location: YYZ
Programs: UA1K2MM ACMME50 SQPPS HHDiamond Marriott Lifetime Titanium
Posts: 4,391
I have a better idea.
How many Aerogold Members are there in Canada?
Increase the Annual Fee to $200,and use the Fee to put in a BID for AC.
CIBC ownership will guarantee profitabilty every year.
When was the last time a Bank reported Losses that I can recall.
How many Aerogold Members are there in Canada?
Increase the Annual Fee to $200,and use the Fee to put in a BID for AC.
CIBC ownership will guarantee profitabilty every year.
When was the last time a Bank reported Losses that I can recall.
#4
Join Date: Apr 2002
Location: YXE
Posts: 3,050
Would the 'employees' ever trust the half-dozen unions and their bosses to run the airline?
I personally think those union bosses would burn their union cards faster than they could sing 'Solidarity Forever' if they were given Air Canada to operate. We have a few examples here in Saskatchewan where union bosses were politically injected into the management of major corporations; slightly oppressive workplaces gradually turned into majorly oppressive workplaces, as the 'union' way of operating is to constantly reinforce the distinction between 'employee' and 'management', rather than to take a cooperative approach and get the job done.
I personally think those union bosses would burn their union cards faster than they could sing 'Solidarity Forever' if they were given Air Canada to operate. We have a few examples here in Saskatchewan where union bosses were politically injected into the management of major corporations; slightly oppressive workplaces gradually turned into majorly oppressive workplaces, as the 'union' way of operating is to constantly reinforce the distinction between 'employee' and 'management', rather than to take a cooperative approach and get the job done.
#6
FlyerTalk Evangelist
Join Date: Sep 2003
Location: Thanks for the Memories !!!
Posts: 10,656
Originally Posted by yyzprincess
I have a better idea.
How many Aerogold Members are there in Canada?
Increase the Annual Fee to $200,and use the Fee to put in a BID for AC.
CIBC ownership will guarantee profitabilty every year.
When was the last time a Bank reported Losses that I can recall.
How many Aerogold Members are there in Canada?
Increase the Annual Fee to $200,and use the Fee to put in a BID for AC.
CIBC ownership will guarantee profitabilty every year.
When was the last time a Bank reported Losses that I can recall.
#7
Join Date: Jan 2003
Location: AC SE, SPG Lifetime Plat, ACMM
Posts: 3,535
Union buying AC? You mean Buzz Air? Will need Federal Govt. Funding ( read unlimited). Employee ownership is a great idea but NOT union ownership. If the Union takes over it will be like George Orwell's Animal Farm--all employees will be equal but some employees will be more equal than others etc.
I have another idea-- why not use all our Aeroplan Points and make a bid for the airline--we could call it AP air-- the money will come from AP and we'll run it efficiently!!
I have another idea-- why not use all our Aeroplan Points and make a bid for the airline--we could call it AP air-- the money will come from AP and we'll run it efficiently!!
#9
Original Poster
Join Date: Jun 2003
Location: YEG
Programs: AC*E75
Posts: 885
Actually most employees could probably come up with the cash, either through an equity takeout on their home or through a personal line of credit. These employees are not that hard up. However, an easier way would be through their pension plan. Even though it is currently underfunded it still would have enough cash to complete the transaction.
I am not thinking that Buzz would become the CEO, heaven forbid, I hope he and the other union heads have enough common sense that they need a professional management team.
There would likely be some regulatory issues but they can be overcome. I think it could work, and talk about incentive pay - compoany succeeds = pension does well and I can retire!
I am not thinking that Buzz would become the CEO, heaven forbid, I hope he and the other union heads have enough common sense that they need a professional management team.
There would likely be some regulatory issues but they can be overcome. I think it could work, and talk about incentive pay - compoany succeeds = pension does well and I can retire!
#11
Original Poster
Join Date: Jun 2003
Location: YEG
Programs: AC*E75
Posts: 885
Originally Posted by exAC
So as an employee you would have
your job,
your retirement plan, and
your investments all tied up in one entity.
Sounds like a recipe for disaster.
your job,
your retirement plan, and
your investments all tied up in one entity.
Sounds like a recipe for disaster.
Yes but a great incentive to work hard so the company succeeds!
Also you are not right most people only have 1 job, the pension I believe has about $10 billion so the AC share would be less than 10% (closer to 5%), only a fool would rely on only 1 source of retirement income, so the % in AC for each employee should drop down even further. They could even divertisfy more by having Ontario Teachers take a minority interest, say $300 million. Then the overall exposure by any employee would be in the 2-3% range, which is not an unreasonable exposure to one company. Plus the other penison assets would be well diversified which would reduce the overall risk.
#12
Join Date: Aug 2001
Location: Ottawa and Montreal
Programs: SPG Gold / IHG Spire / Emerald Executive Elite
Posts: 457
Originally Posted by YUL
Old post last week : "How about an employee buy-out"
Well, we're now at few remaining options (read none). After having seen the latest developements, I really dont want any taxpayer's money in this non-sens ideological circus.
Let's say all the stakeholders realise the futility of some issues and get to the point: making AC a viable operation.
Would the employees have anything to loose if, let's say, they accept drastic pay cuts in exchange of equivalent equity.
Then have AC rationalise domestic routes/frequency (vs costly predatory behevior) and let domestic competitors in (who cares at this point).
Allow fair interlining agreements with domestic competitors so we keep those connecting passengers on international routes.
Concentrate ressources on cross border/intenational routes where AC is at it's best.
AC would then be able to generate an operating cash flow, so it would better alive than dead for all the creditors. All stakeholders (including GE and its cash infusion) would then get in the wagon and participate the same way they did for Trinity.
If up front cash is still required...
Well, we're now at few remaining options (read none). After having seen the latest developements, I really dont want any taxpayer's money in this non-sens ideological circus.
Let's say all the stakeholders realise the futility of some issues and get to the point: making AC a viable operation.
Would the employees have anything to loose if, let's say, they accept drastic pay cuts in exchange of equivalent equity.
Then have AC rationalise domestic routes/frequency (vs costly predatory behevior) and let domestic competitors in (who cares at this point).
Allow fair interlining agreements with domestic competitors so we keep those connecting passengers on international routes.
Concentrate ressources on cross border/intenational routes where AC is at it's best.
AC would then be able to generate an operating cash flow, so it would better alive than dead for all the creditors. All stakeholders (including GE and its cash infusion) would then get in the wagon and participate the same way they did for Trinity.
If up front cash is still required...
Éric
#15
Join Date: Sep 2002
Location: Centre of the Universe
Posts: 502
There is a story in the Globe today about this....