Bombardier Inc. sold an additional US$260 million of its 7.45 per cent bonds due 2034 to an unidentified party in a move that will make it more difficult for creditors to trigger a default by arguing that the company’s divestitures ran afoul of investor debt protections.

The buyer of the new notes owns a majority of the US$510 million of 2034 securities and has agreed to approve certain covenant changes tied to the bonds, Bombardier said in an statement Tuesday. Bombardier is in the process of getting investor approvals to amend terms of eight bonds after it received a letter from a holder of the 2034 notes that argued sales of assets including its transportation business, regional jet program and aerostructures division constituted a breach of certain covenants.

“The new investor is acting as a white knight here,” Covenant Review analyst Alexander Diaz-Matos said in emailed reply to questions. “It does look like that the new majority investor giving consent should address possible default claims.”

Bombardier said in a May 3 statement that it believes the covenant violation accusation is “without merit” but “determined that initiating the consent solicitations is the most expedient and efficient path to maintain value and protect the corporation and its stakeholders.”

The aircraft maker needs approval from holders of more than 50 per cent of each of its U.S. dollar bonds. The Canadian-dollar issue requires a two-thirds majority, a representative for Bombardier previously told Bloomberg.

Bombardier extended the deadline for holders of the 2034 bonds to approve the changes to 5 p.m. in New York on Friday and is asking investors in those notes who previously consented to the new terms to resubmit their approvals. The deadline to agree to changes for investors in Bombardier’s $135 million (US$112 million) of 7.35 per cent bonds due 2026 was also moved to Friday.

If bondholders approve the changes, Bombardier will pay investors who agreed to the amendment a fee of US$1.25 per US$1,000 in bond principal held. Holders of the company’s Canadian-dollar bonds will receive $1.25 per $1,000 in principal, the company said in the May 3 statement.

Bombardier completed the sale of its transportation business to Alstom in January in a deal that produced net proceeds of approximately US$3.6 billion.