Shares in Bombardier Inc. and BlackBerry Ltd., one a staple of Canadian pension funds, the other a formerly high-flying technology company whose ubiquitous devices were in the hands of presidents and common folks alike, fell on Monday after being removed from Canada’s blue-chip stock index.
Shares of Bombardier were down more than 10 per cent at 46 cents and those of BlackBerry had fallen 5 per cent to $6.80 in afternoon trade.
Index manager S&P Dow Jones Indices said on Friday it would remove the two companies from the S&P/TSX 60 index effective Monday. The criteria for being on the index include market value and trading liquidity — the shares easily available to the public for trading.
Montreal-based Bombardier’s shares have slumped over 75 per cent this year and have struggled to remain over the $1 mark since March. The company had a market value of $36 billion (US$26.51 billion) at its peak, and is now worth $1.3 billion.
Known for its cutting edge technology in aviation and transportation, Bombardier evolved from selling snowmobiles decades ago into a global plane and train maker.
The company, which in recent years has battled cost overruns and raked up billions in debt, would be reduced to a pure-play business jet maker after the planned sale of its transportation business to Alstom SA.
“The TSX’s action doesn’t change either our near-term priorities or long-term goals,” a spokeswoman for Bombardier told Reuters.
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BlackBerry shares have lost nearly 20 per cent this year so far. During its heyday, the company enjoyed a market value of about $84 billion, and is worth less than $4 billion today.
For many years, from presidents to Wall Street bankers swore by BlackBerry phones for its superior data encryption and manageability. But over time, the company ceded market share to Apple Inc, Samsung and others, before the Waterloo-based company stopped producing handsets altogether.
© Thomson Reuters 2020