CHC LLC purchases Babcock
nowherespecial
Unlike in Europe, there is no equivalent to the Transfer of Undertakings Regulations (or TUPE). If a business is sold or outsourced, employees will only transfer if the ‘new employer’ makes an offer of employment that the employee accepts. Where employees transfer in these circumstances, the new employer may become liable for their accrued leave entitlements. In addition, any enterprise agreement covering the employees is also likely to transfer to the new employer.
I'm not an expert on Australian labour law but I'd be surprised if there were not legal mechanisms similar to protect employees there too so you should assume all Babcock staff will come across and then, as outlined by Apate, the matrix comes out.
Thanks II.
I would note that while those laws do not seems very helpful for employees, at least a mechanism exists where jobs have to be offered. Businesses with no employees generally are not very successful so while fat trimming is possible, the idea that no one will get a job in a merged entity is unlikely. And of course there is the optics and union/ CBA angle as well, esp in Australia.
For everyone else asking.
Laws apply in the country the events take place in. TUPE as a law came across under Brexit so 'British TUPE' will apply to the UK entity (my last check is from Feb 2021 and the law was not amended from the EU version). The Danish entity is still subject to 'full EU' TUPE. Under EU law it was illegal for 100% foreign ownership of businesses in the EU. An EU shareholder had to have more than 50% and thus control. This is the purpose of the shareholder in Switzerland (Ivan Levy/ EAA), known as a silent shareholder. Generally these silent shareholders do nothing other than legitimise the entity for ownership rules (in exchange for a nice fee of course) and there will be management documents underneath that ownership structure which essentially neuter that shareholding to make (in this case) CHC LLC the controller of entity. Under Brexit, the UK Government might wish to change so that all businesses have to be 50% British owned and Mr Levy will be managed aside.
None of this changes that UK/ Danish/ Australian entities are subject to local law, and not Cayman/ US/ any other. The HQ of CHC LLC is irrelevant. Helitr also touched on this in post 49.
I would note that while those laws do not seems very helpful for employees, at least a mechanism exists where jobs have to be offered. Businesses with no employees generally are not very successful so while fat trimming is possible, the idea that no one will get a job in a merged entity is unlikely. And of course there is the optics and union/ CBA angle as well, esp in Australia.
For everyone else asking.
Laws apply in the country the events take place in. TUPE as a law came across under Brexit so 'British TUPE' will apply to the UK entity (my last check is from Feb 2021 and the law was not amended from the EU version). The Danish entity is still subject to 'full EU' TUPE. Under EU law it was illegal for 100% foreign ownership of businesses in the EU. An EU shareholder had to have more than 50% and thus control. This is the purpose of the shareholder in Switzerland (Ivan Levy/ EAA), known as a silent shareholder. Generally these silent shareholders do nothing other than legitimise the entity for ownership rules (in exchange for a nice fee of course) and there will be management documents underneath that ownership structure which essentially neuter that shareholding to make (in this case) CHC LLC the controller of entity. Under Brexit, the UK Government might wish to change so that all businesses have to be 50% British owned and Mr Levy will be managed aside.
None of this changes that UK/ Danish/ Australian entities are subject to local law, and not Cayman/ US/ any other. The HQ of CHC LLC is irrelevant. Helitr also touched on this in post 49.
Last edited by nowherespecial; 15th Mar 2021 at 06:14.
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Has the takeover stengthened CHC's position in the SNS? Still a major contract hangs in the balance which is due to expire in May 2021. No rumours it seems as to if they wil retain it or it will go the way of a yellow livery.
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Originally Posted by nowherespecial
Thanks II.
I would note that while those laws do not seems very helpful for employees, at least a mechanism exists where jobs have to be offered. Businesses with no employees generally are not very successful so while fat trimming is possible, the idea that no one will get a job in a merged entity is unlikely. And of course there is the optics and union/ CBA angle as well, esp in Australia.
For everyone else asking.
Laws apply in the country the events take place in. TUPE as a law came across under Brexit so 'British TUPE' will apply to the UK entity (my last check is from Feb 2021 and the law was not amended from the EU version). The Danish entity is still subject to 'full EU' TUPE. Under EU law it was illegal for 100% foreign ownership of businesses in the EU. An EU shareholder had to have more than 50% and thus control. This is the purpose of the shareholder in Switzerland (Ivan Levy/ EAA), known as a silent shareholder. Generally these silent shareholders do nothing other than legitimise the entity for ownership rules (in exchange for a nice fee of course) and there will be management documents underneath that ownership structure which essentially neuter that shareholding to make (in this case) CHC LLC the controller of entity. Under Brexit, the UK Government might wish to change so that all businesses have to be 50% British owned and Mr Levy will be managed aside.
None of this changes that UK/ Danish/ Australian entities are subject to local law, and not Cayman/ US/ any other. The HQ of CHC LLC is irrelevant. Helitr also touched on this in post 49.
I would note that while those laws do not seems very helpful for employees, at least a mechanism exists where jobs have to be offered. Businesses with no employees generally are not very successful so while fat trimming is possible, the idea that no one will get a job in a merged entity is unlikely. And of course there is the optics and union/ CBA angle as well, esp in Australia.
For everyone else asking.
Laws apply in the country the events take place in. TUPE as a law came across under Brexit so 'British TUPE' will apply to the UK entity (my last check is from Feb 2021 and the law was not amended from the EU version). The Danish entity is still subject to 'full EU' TUPE. Under EU law it was illegal for 100% foreign ownership of businesses in the EU. An EU shareholder had to have more than 50% and thus control. This is the purpose of the shareholder in Switzerland (Ivan Levy/ EAA), known as a silent shareholder. Generally these silent shareholders do nothing other than legitimise the entity for ownership rules (in exchange for a nice fee of course) and there will be management documents underneath that ownership structure which essentially neuter that shareholding to make (in this case) CHC LLC the controller of entity. Under Brexit, the UK Government might wish to change so that all businesses have to be 50% British owned and Mr Levy will be managed aside.
None of this changes that UK/ Danish/ Australian entities are subject to local law, and not Cayman/ US/ any other. The HQ of CHC LLC is irrelevant. Helitr also touched on this in post 49.
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“Babcock has set aside $7.285 million in the form of “an exceptional provision” for “loss-making contracts where unavoidable costs of meeting obligations under these contracts exceed the associated expected future net benefits.”
Looking ahead, would this put TUPE into question? (A company knowingly taking on loss making contracts with the view of selling up.)
Originally Posted by Jetboxer
Questions need to be asked. With regard to the UK division, when bidding on the TOTAL work, these costs were not unavoidable. They could simply be avoided by not bidding, or bidding at a sensible rate.
Looking ahead, would this put TUPE into question? (A company knowingly taking on loss making contracts with the view of selling up.)
Looking ahead, would this put TUPE into question? (A company knowingly taking on loss making contracts with the view of selling up.)
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Originally Posted by helicrazi
How do you know its Total that's loss making?
https://www.energyvoice.com/oilandga...pter-contract/
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Taking contracts on as lost leaders isn’t anything new. In fact I’ve heard several Bristow middle managers state in the last few weeks that they made no money on Apache to try and play it down. My information is that they did make money on it.
It’s the balancing act of taking some work at near enough to cost and juggling it alongside the more profitable short term stuff (oops drilling!) and right now the gift that keeps giving is CMED evacs which despite all the good press are not being done for free.
It takes the skill of a good Accountable Manager to balance what contracts to take on and what to leave well alone if it is indeed these incumbents who actually make that call in the first place? I suspect it’s more the decision support guys in faraway offices that have a bigger call than technically they should.
It’s the balancing act of taking some work at near enough to cost and juggling it alongside the more profitable short term stuff (oops drilling!) and right now the gift that keeps giving is CMED evacs which despite all the good press are not being done for free.
It takes the skill of a good Accountable Manager to balance what contracts to take on and what to leave well alone if it is indeed these incumbents who actually make that call in the first place? I suspect it’s more the decision support guys in faraway offices that have a bigger call than technically they should.
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O & G companies expecting "a Rolls Royce service for the price of a knackered banger" , nothing new here , always a few contracts that turn out after initial bid then subsequent award that seem to be not as revenue rich in the long term , “golden apples turning sour” – read the label or sell by date first.
Possible scatter gun future predictions of the actual service levels and the flying requirements provided in the early stages and in the tender specifications, some customer specifications can be optimistic and sometimes thin - it’s all very crystal ball at times.
On the other hand in this case appears to be , scoop up all the available contracts however you can, build a portfolio that could be attractive to any other interested party and then sell it all on at the right time down at the local market/auction rooms, bargains are there for the entrepreneurs.
“Come on down – the price is right!”
Suitcase full of cash and order a fast taxi for a timely exit – result
.
Possible scatter gun future predictions of the actual service levels and the flying requirements provided in the early stages and in the tender specifications, some customer specifications can be optimistic and sometimes thin - it’s all very crystal ball at times.
On the other hand in this case appears to be , scoop up all the available contracts however you can, build a portfolio that could be attractive to any other interested party and then sell it all on at the right time down at the local market/auction rooms, bargains are there for the entrepreneurs.
“Come on down – the price is right!”
Suitcase full of cash and order a fast taxi for a timely exit – result
.
Last edited by dustycraphopper; 17th Mar 2021 at 18:07. Reason: edit
Originally Posted by dustycraphopper
O & G companies expecting "a Rolls Royce service for the price of a knackered banger" , nothing new here , always a few contracts that turn out after initial bid then subsequent award that seem to be not as revenue rich in the long term , “golden apples turning sour” – read the label or sell by date first.
Possible scatter gun future predictions of the actual service levels and the flying requirements provided in the early stages and in the tender specifications, some customer specifications can be optimistic and sometimes thin - it’s all very crystal ball at times.
On the other hand in this case, scoop up all the available contracts however you can, build a portfolio that could be attractive to any other interested party and then sell it all on at the right time down at the local market/auction rooms, bargains are there for the entrepreneurs.
“Come on down – the price is right!”
Suitcase full of cash and order a fast taxi for a timely exit – result
.
Possible scatter gun future predictions of the actual service levels and the flying requirements provided in the early stages and in the tender specifications, some customer specifications can be optimistic and sometimes thin - it’s all very crystal ball at times.
On the other hand in this case, scoop up all the available contracts however you can, build a portfolio that could be attractive to any other interested party and then sell it all on at the right time down at the local market/auction rooms, bargains are there for the entrepreneurs.
“Come on down – the price is right!”
Suitcase full of cash and order a fast taxi for a timely exit – result
.
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There is one guaranteed method of forcing your competition into action, grab market share at any cost and force your competitors into an existential corner. Babcock knew exactly what they were doing when they bid these contracts, and understood that any resultant losses would be short-lived, because they had already stated they wanted out of this business. Someone was going to have to step up and purchase them, or risk going under and Babcock would then grab an even greater market share and be able to drive the pricing with a changing marketplace with one less competitor - and they definitely didn't want that outcome.
As for forcing Operators to bid with profitable pricing, I'm not sure I can envision the regulatory, financial and legal framework this would require. I would suggest that at this time, none of the Operators on the North Sea might pass that test, as they are still financing expensive non-revenue generating assets and infrastructure, while the operational capacity might be significantly below that projected to fund business expenses planned sometime in the past.
Reviewing the financials of the businesses that publicly report them, none of them might meet that profitability criterion. If they were to increase rates to accommodate these expenses, what kind of rates do you think would be required - and would anyone pay them? It is only a matter of time before the market recovers adequately to fund the operators, or they will simply fail and be acquired for next to nothing by the next helicopter business genius. The current strategy appears to be that it's better to go broke slowly and still have a chance at survival, than losing the bids and associated revenue and predictably going bust. That's business.
As for forcing Operators to bid with profitable pricing, I'm not sure I can envision the regulatory, financial and legal framework this would require. I would suggest that at this time, none of the Operators on the North Sea might pass that test, as they are still financing expensive non-revenue generating assets and infrastructure, while the operational capacity might be significantly below that projected to fund business expenses planned sometime in the past.
Reviewing the financials of the businesses that publicly report them, none of them might meet that profitability criterion. If they were to increase rates to accommodate these expenses, what kind of rates do you think would be required - and would anyone pay them? It is only a matter of time before the market recovers adequately to fund the operators, or they will simply fail and be acquired for next to nothing by the next helicopter business genius. The current strategy appears to be that it's better to go broke slowly and still have a chance at survival, than losing the bids and associated revenue and predictably going bust. That's business.
Originally Posted by 212man
Seems odd timing? https://jobs.babcockinternational.co...7DU/659689101/
Stop throwing facts in the mix, helicrazi. Completely uncalled for and doesn’t fit in with the speculation and conspiracy theories that are the foundations we build on.
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Originally Posted by helicrazi
MD off sick, D of O stepped up to MD, so D of O needs replacing... not odd timing just circumstances
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Originally Posted by pants on fire...
That's quite the position to be offering with no previous experience required! Should make it pretty easy to fit in with the rest of the team.
It will be a pleasure to see certain management finally fall to earth with the rest of us. Bittersweet but a pleasure nonetheless. Can't wait to work alongside them stacking shelves in Tesco's......its a wet dream of mine
Originally Posted by Medevac999
It would be interesting to know how this purchase is being funded? Someone must be bankrolling CHC.
