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Discovery Air Rescued

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there are also still a few companies that are run by pilots who do "give a crap about pilot wages"

 

 

... and feel that engineers just take away from the pilot wages with all those parts they want to buy :)

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Last week I had the pleasure of traveling to Yellowknife for some training at GSH. I have to say that I was impressed with the operation and the personnel that work there. One point near and dear to my heart was their willingness to hire low time pilots and mentor them thru various projects to get these young pilots experience and hours flying.

 

Interestingly enough, this thread came up in conversation and while it was good to hear what is really going on, it is sad how this thread has gone down the $hi&&er.

 

I have seen threads close for kicking a dead horse quicker than this in the past and I would think 17 pages is probably enough here too.

 

JR, AB and IH, it was a pleasure meeting you chaps, you guys are professionals in every way!

 

I will now go back into hibernation....cheers!

 

412driver

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About time somebody said something positive, Going into debt is a fact of life. Bigger pay check bigger loan. Hopefully we have a smoky summer and every body can put a little money on their loans.

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Some people on this forum might want this to go away. It appears the MLA's don't want to drop it. This could get interesting if the assets don't cover the loan value.

 

N.W.T. MLAs seek audit of $34M loan to Discovery Air

 

 

Members on a Northwest Territories legislative committee have asked federal Auditor General Sheila Fraser's office to review a $34-million government loan to northern airline Discovery Air.

 

 

The 48-month loan given out last month was the first of its kind from the N.W.T. government's Opportunities Fund. The loan helped replace the company's $33-million debt.

 

The legislature's economic development committee forwarded a number of concerns about the loan to the auditor general's office.

 

"I think you have to be accountable to somebody in doing that," Kam Lake MLA Dave Ramsay, who chairs the committee, told CBC News on Thursday.

 

"There's some policy changes in that Opportunities Fund that I think the auditor general should have a look at as well ... the decision-making process needs to be thoroughly examined so something like this doesn't happen again."

 

Ramsay would not say what MLAs have been told about what Discovery Air assets were used to secure the loan, except to say those assets were "not substantial."

 

A spokesman for Discovery Air would not discuss those assets either.

 

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So can anyone tell me is the head office now in Yellowknife and is the flying school up and running. I don't see any news clippings or adds saying they are accepting students yet.

 

 

Here are more details... not good....

 

Northern News Services

Published Wednesday, January 21, 2009

SOMBA K'E/YELLOWKNIFE - Discovery Air has penned a deal with the territorial government to borrow $34 million dollars, aimed to help the company and its Northern subsidiaries stay in the air.

 

Discovery owns Great Slave Helicopters, Air Tindi and Discovery Mining Services and employs about 275 Northern workers.

 

The deal, announced Monday, will work as a loan and is expected to help Discovery recover from what it recently called "the rapid deterioration in general business conditions" - otherwise known as the economic slowdown. The majority of the cash will be used to refinance $33-million of debt, which was acquired in 2007 when the company entered into a loan agreement for a portion of the $35 million-plus purchasing price of Quebec-based military training company Top Aces.

 

In it's most recent quarterly statement, for the period ending Oct. 31, 2008, Discovery widely acknowledged if the loan - which comes to term Feb. 1, 2009 - was not refinanced or extended the company would be in serious trouble: "The Corporation recognizes ... the Corporation could be placed in a situation by its lenders where it is not able to operate."

 

The same financial statement puts Discovery's overall long-term debt at $145 million -- $40 million of which is set to come due within one year. In the nine months ending Oct. 31, the company has brought in $132 million in revenue - but only $8.8 million in net earnings.

 

"We've been in the market for several months looking around to various sources in the south and some of the more typical lenders from Toronto," said David Jennings, chief executive officer and interim president of the company.

 

Jennings said he found out about a funding program in the North called the Northwest Territories Opportunities Fund through a consultant.

 

"Our company believes very strongly in the Northern economy," said Jennings, adding long-term growth for the company hinges on it having a big presence in the North.

 

"This was a deal that appealed to us for that reason -- so we could keep the strong presence in the North and keep the Northern companies stronger," said Jennings.

 

The multi-million loan, which has a 48-month term and bears a 10 per cent yearly interest, comes with several strings attached.

 

One is to move it's nine-person London, Ont. corporate headquarters to Yellowknife, and another is to run its Great Slave Helicopter flying school in the North.

 

Both conditions will benefit Yellowknife as the company works to build growth in the North, said Jennings.

 

"It's more pilot jobs, it's more mechanic jobs, it's more administrative jobs -- in Yellowknife and throughout the North," he said.

 

Discovery cut six Yellowknife positions late last November partly in response to a decline in business from the slowing mining exploration scene. Jennings said it was too early to tell if the cash injection from the territorial government would mean putting people back in those jobs, but did say it should mean no further lay-offs.

 

"We don't expect any further layoffs, and depending on how this funding had gone it could have been a possibility. I'm not saying it would have been a possibility, but it could have," he said.

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