Which carrier wants a piece of Air Canada...?

[groundtoflightdeck]

This isn't my area of expertise, but a middle eastern carrier looking for Canadian slots and 777 options may find this titillating...




MONTREAL, May 4, 2012 /CNW Telbec/ - Air Canada (TSX: AC.B AC.A) announced today that it has received a conditional exemption which would effectively treat Air Canada's Class A variable voting and Class B voting shares as a single class for the purposes of applicable take-over bid requirements and early warning reporting requirements contained under Canadian securities laws. The exemption, however, will become effective immediately (but only) upon shareholder approval of proposed related amendments to Air Canada's shareholder rights plan agreement, which Air Canada will seek at its annual and special meeting of Air Canada shareholders to be held on June 4, 2012. Additional details of the exemption and the proposed amendments to Air Canada's shareholder rights plan agreement are provided below.

Exemption from Applicable Take-Over Bid Requirements and Proposed Amendments to Air Canada's Shareholder Rights Plan

On May 4, 2012, pursuant to an application by Air Canada, the Autorité des marchés financiers, as principal regulator, the Ontario Securities Commission and the securities regulatory authorities in the other provinces of Canada granted exemptive relief (the "Decision") from (i) applicable formal take-over bid requirements, as contained under Canadian securities laws, such that those requirements would only apply to an offer to acquire 20% or more of the outstanding Class A variable voting shares and Class B voting shares of Air Canada on a combined basis, and (ii) applicable early warning reporting requirements, as contained under Canadian securities laws, such that those requirements would only apply to an acquirer who acquires or holds beneficial ownership of, or control or direction over 10% or more of the outstanding Class A variable voting shares and Class B voting shares of Air Canada on a combined basis (or 5% in the case of acquisitions during a take-over bid). A copy of the Decision is available on SEDAR at Welcome to the SEDAR Web Site / Bienvenue au Site Web SEDAR (http://www.sedar.com).

The Decision, however, will become effective immediately (but only) upon shareholder approval of the proposed amendments to the shareholder rights plan agreement (the "Rights Plan") dated as of March 30, 2011 between Air Canada and CIBC Mellon Trust Company described in the management proxy circular. The proposed amendments are subject to approval by a majority of the holders of Class A variable voting shares and Class B voting shares of Air Canada (voting together as a single class), voting in person or by proxy at Air Canada's June 4, 2012 meeting.* Subject to certain exceptions identified in the Rights Plan, the Rights Plan currently would be triggered in the event of an offer to acquire 20% or more (on a per class basis) of the outstanding Class A variable voting shares or Class B voting shares. The proposed amendments would modify the Rights Plan to be consistent with the Decision so that it would only be triggered by an offer to acquire 20% or more of the outstanding Class A variable voting shares and Class B voting shares of Air Canada on a combined basis. A copy of the management proxy circular is available on Air Canada's website at aircanada.com or on SEDAR at Welcome to the SEDAR Web Site / Bienvenue au Site Web SEDAR (http://www.sedar.com).

Objective of the Decision

While having increased its public float significantly over recent years, and having a flexible capital structure that is designed to permit non-Canadian (as defined under the Canada Transportation Act) investors to become shareholders of Air Canada, the relatively small number of outstanding Class A variable voting shares (the share class for non-Canadians) may limit the ability of non-Canadians to acquire shares of Air Canada. In an effort to facilitate the acquisition of Class A variable voting shares, Air Canada applied to the Autorité des marchés financiers, as principal regulator, and the Ontario Securities Commission in order to seek the Decision. Though applicable take-over bid rules and early warning requirements apply to the acquisition of securities of a class, it was acknowledged in the Decision that aggregating Class A variable voting shares and Class B voting shares for the purpose of the take-over bid rules and early warning requirements may facilitate the acquisition of Class A variable voting shares. Because of the relatively small public float of Class A variable voting shares (compared to the public float of Class B voting shares), absent the Decision, it may be more difficult for non-Canadians to acquire shares in the ordinary course without the apprehension of inadvertently triggering the take-over bid rules or early warning requirements. The Decision considered the fact that the Class A variable voting shares and Class B voting shares have identical terms except for the foreign ownership voting limitations applicable in the case of the Class A variable voting shares.

The Decision also takes into account the fact that Air Canada's dual class shareholding structure was implemented solely to ensure compliance with the requirements of the Air Canada Public Participation Act and the Canada Transportation Act. An investor does not control or choose which class of Air Canada shares it acquires and holds. The class of shares ultimately available to an investor is only a function of the investor's status as a Canadian (holders of Class B voting shares) or non-Canadian (holders of Class A variable voting shares).

Shareholders of Air Canada will be asked at the meeting to consider and, if thought advisable, adopt a resolution approving the proposed amendments to the Rights Plan.

The Rights Plan, approved at Air Canada's 2011 annual and special shareholders meeting, is designed to provide the Air Canada's shareholders and the Board of Directors additional time to assess an unsolicited take-over bid for the company and, where appropriate, to give the Board of Directors additional time to pursue alternatives for maximizing shareholder value. It also encourages fair treatment of all shareholders by providing them with an equal opportunity to participate in a take-over bid.

For more information relating to the proposed amendments to the Rights Plan, including the full text of the proposed amendments, please refer to Air Canada's management proxy circular which is available on Air Canada's website at aircanada.com or on SEDAR at Welcome to the SEDAR Web Site / Bienvenue au Site Web SEDAR (http://www.sedar.com).

About Air Canada

Air Canada is Canada's largest domestic and international airline serving more than 180 destinations on five continents. Canada's flag carrier is the 15th largest commercial airline in the world and in 2011 served more than 33 million customers. Air Canada provides scheduled passenger service directly to 60 Canadian cities, 57 destinations in the United States and 63 cities in Europe, the Middle East, Asia, Australia, the Caribbean, Mexico and South America. Air Canada is a founding member of Star Alliance, the world's most comprehensive air transportation network serving 1,290 destinations in 189 countries. In 2011, Air Canada was ranked Best International Airline in North America in a worldwide survey of more than 18 million airline passengers conducted by independent research firm Skytrax.

CAUTION REGARDING FORWARD-LOOKING INFORMATION

Air Canada's public communications may include forward-looking statements within the meaning of applicable securities laws. Forward-looking statements, by their nature, are based on assumptions and are subject to important risks and uncertainties. Forward-looking statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business. Actual results may differ materially from results indicated in forward-looking statements due to a number of factors, including without limitation, industry, market, credit and economic conditions, the ability to reduce operating costs and secure financing, pension issues, energy prices, employee and labour relations, currency exchange and interest rates, competition, war, terrorist acts, epidemic diseases, environmental factors (including weather systems and other natural phenomena and factors arising from man-made sources), insurance issues and costs, changes in demand due to the seasonal nature of the business, supply issues, changes in laws, regulatory developments or proceedings, pending and future litigation and actions by third parties as well as the factors identified throughout Air Canada's public disclosure file available at Welcome to the SEDAR Web Site / Bienvenue au Site Web SEDAR (http://www.sedar.com), and, in respect of the proposed amendments to Air Canada's shareholder rights plan referred to above, the obtaining of the required shareholder approval at Air Canada's June 4, 2012 annual and special meeting of shareholders. Any forward- looking statements contained in this news release represent Air Canada's expectations as of date of this news release and are subject to change after such date. However, Air Canada disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations.


For further information:
Isabelle*Arthur (Montréal)**514 422-5788
Peter*Fitzpatrick (Toronto)**416 263-5576
Angela*Mah (Vancouver)**604 270-5741

Internet*:**aircanada.com

[Obbie]

Ummmm......nobody !!!

Let her die and get it over with.

The Canadian industry will be better for it in the long run.

[nolimitholdem]

Better for whom? The out of work AC employees, or the scumbag operators who could move in with cheap labour from the Middle East?

hmmmm....

Perhaps it would be better for the "hyphenated-Canadians" with their Canadian passports, who could then get cheaper access to their overseas homes...but I wouldn't confuse that with being "better for the industry" in Canada.

By that logic, I suppose you also think that shifting all of the manufacturing to China has been great for the manufacturing industry in Ontario.

Yep. :yuk:

It's all working out great....

[Left Coaster]

Uh oh...looks like a sore point! Did you know that most of the Canadians who work for one of those "Scumbag" carriers have been forced out of their jobs in Canada by the policy that pretty much decrees that the flag carrier lives at all costs? Hundreds of pilots left Canada because the Government of the day pulled a fast one and made it impossible to compete fairly as a Canadian airline against the National Shame...Well I can safely say that the "Scumbag Airline" that quite a few of these poor buggers work for has paid more than the big red machine ever did, put kids through school, money in banks and kept careers alive, which is more than they were ever gonna get at home...and I'm pretty GD sure that there are NO hyphens attached to their passports, so keep your zenophobic rants out of this thread, it has no place here...and no I don't work for the airline you so clearly refer to...

[fatbus]

Here here LC!!! If it wasn't for AC/Milton / Canadian Gov bailouts (and yes there was) I would still be in Canada.

[Easy Ryder]

Hey NoLimit,

I guess that will benefit pretty much the entire Canadian population as most are 'hyphenated', as you put it, except for a handful of the original indigenous population that remains? :ok:

[nolimitholdem]

First of all "hyphenated"-Canadians is not a label I coined. It's an invention of the largely failed policy of multiculturalism, and is a tag generally picked up by the (ever-larger) number of Canadian citizens who are quick to cling to their origins, while strangely, quite happily lapping up the benefits afforded by the "Canadian" part of their self-assigned title. Strange that in spite of my non-aboriginal status I never felt the need to identify myself as anything other than "Canadian". It's one thing to be proud of your heritage, another to use Canada as a passport of convenience.

And funnily enough, it's one of those terms that many of the same sorts in Canada like to toss out at the drop of a hat, like "xenophobic", or "racist". Anyone in Canada that wraps themself in THAT blanket, pretty much gets a free pass. Again, why Canada is considered a "soft target" by the world's shyster immigration lawyers, and a laughingstock. Don't believe me? Try living outside of Canada for a new perspective. The blatant, casual, endemic racism of the UAE (like most places) would make a cute picture of your Canadian jaw on the floor, yet - it would be better if they had MORE access to your bastion of political correctness, Canada? Interesting logic. As the tired old expat joke goes, the only difference between a tourist and a racist in Dubai is...about two weeks. No amount of fuzzy feel-good multi-cult nonsense, glossy government propaganda, or shouting "bigot" changes reality. Something ALL Canadians, not just in aviation, are about to get smacked in the face with if the Cons REALLY open the immigration taps and let employers dictate the terms of entry. They offshored manufacturing, they're doing it with aviation, just wait till they do it with skilled positions. I'm sure there are plenty of Filipino or Indian engineers who would love to come to Canada on a three-year work visa and work in Fort Mac for a fraction of the wage of a native citizen. It's coming, just don't wish it so readily on the aviation industry.

Left Coaster, your post made me laugh, because you see, I once worked for one of those scumbag operators. I used the term because it's one of the kinder ones I could find. I also know firsthand the hardships of the Canadian industry - it's how I ended up working for the aforementioned 'bags - but I can tell you that ME carriers are even more ruthless, cut-throat and devious than anything Milton ever devised. Perhaps if you had worked for many years in the Middle East, you would have an idea about what you're talking about. It's an area of the world that still considers slavery an ok thing. I have no love lost for AC, particularly their amoral management, but wishing for them to collapse so they can be replaced with cheap overseas labour - because that's what the Gulf carriers are - is just unbelievable. Be careful what you wish for eh?!

And fatbus, I'm sorry it didn't work out for you at AC, but it pretty much answers my question of which profile Canadian EK cheerleaders fall into...those who still feel hard done by by the CDN merger, or didn't get the seniority number they wanted, or just plain couldn't get on AC. Now they get to play widebody captain in the desert and they're livin' large. But the issues are a lot bigger than just Emirates getting into Canada, it's about expats ever having a chance to work in their home country again on something resembling a Western living wage. Perhaps you've gone native and think Dubai is the greatest thing since sliced bread, but I'll bet most people would love to go home and work there, if they could only afford to. Letting cheap labour flood the market isn't exactly going to enhance those prospects, even if seeing AC suffer might give you some sort of warped personal satisfaction.

[Left Coaster]

Glad you found humour in my post...always leave em laughing was what my Grampa said! Funny then what your post assumes...so let me clear a few things up for ya! I actually did work for the Blue guys and when the place laid me off for the SECOND time...(it got old fast!) and after I LOST dozens of numbers to the red machine in the merge... I had a chance to move into a great place to work and a command a hell of a lot faster than any one with the seniority number I was left with would have, and no there was no job theft involved! (:ooh:) As a matter of fact with the number I had I'm STILL not able to hold any left seat anywhere in the AC system...soooo, make of it what you will, it wasn't pretty. And I'm gettin' old! That's all ancient history...as you say the industry in Canada is in turmoil and is only getting worse. In the meantime,you have some serious burr under your saddle and toss about words like slavery and such, and your distaste is evident when it comes to immigration policy and of course you are entitled to your opinion. Just remember this...how may "Hyphenated Canadians" lie under the graves in Europe, after fighting for our freedom in BOTH wars? Ask how many still guard it for people like us? I won't get into it with you as I learned a long time ago to pick my battles...So... I work in the region you seem to have left (hard to tell, for all I know you might still be here, and if so, what's keeps you here? I'll tell ya... Because there ain't jack back home unless you can get a corporate gig worth big $$$...hard to find those...or you get to start at the bottom again!) Lots of your colleagues are still here, living and doing well and making more than they ever will if they leave, so it's what you make of it. isn't it? I have worked in a number of countries in the last 12 years, quite a few of those years here and yeah, it ain't home, but then I never expected it to be...but it affords my family opportunities to grow as people, learn new cultures and, as a result, enables them to determine what kind of person they want to be. Can you say that? Over to you...fly safe! LC
Oh by the way..I never did say I was hoping for a total collapse at AC...that's someone elses wish, not mine...total disaster comes to mind if that ever happened.

[nolimitholdem]

Lefty,

I'm afraid you're talking to the wrong guy if you want sympathy about being laid off a couple times, in the Canadian industry and compared to my personal history that would be several layoffs short of the average. And no seniority number to speak of. But it's kind of interesting to note that after leaving your home, enjoying the advantages you couldn't have after the merger (beyond still being employed at home) that you still track your "seniority" number to see where you would have been. (Time to move on psychologically, not just physically, perhaps?)

But here's the thing - the fact that the expat market benefited you (and me, and many others) isn't an argument supporting destruction of well-paying jobs to be supplanted with people who will do it "cheaper". That relentless drive to lower costs is why the EK guys pull 95 hour rosters, can't get their contractual leave, and then reap no bonus even when a company makes a mere 600 million dollar profit. Beyond the pilots - whose wages are artificially competitive solely due to the tax-free environment - the Gulf airlines are run by indentured servitude from the ground up. Full stop.

To the charge of tossing words around, I believe you were pretty quick to describe me as "xenophobic" simply because I happen to think that allowing employers to exploit desperate foreigners isn't exactly going to help all of the many currently unemployed citizens back home. I do think "slavery" is far closer to accurately describing the way the ME views hired help. It may not be folks chained to one another singing Swing Low, but it's the same mindset.

You've completely misunderstood my take on the hyphenated Canadian thing. If anything your example supports my point: the Canadians buried near Vimy and the Somme ceased to be colonialist "whatever-Canadians" and at that time, became simply…Canadians. There was no more "I'm from here, you're from there"…they were all just scared kids from Canada. I have many friends in the military and they would be mightily insulted if you prepended ANYTHING in front of the word "Canadian" to describe them. But now we have generations that refuse to identify themselves outside of their previous heritage, with the passport viewed as a convenient accessory that allows them a lot of advantages with no loyalty to the country that took them in. THAT is what irks me, and what I hold in contempt. Clearer now?

Anyway this thread has wandered a bit, but I do think all of these issues are related, what with all of the Canadian aviation refugees in the ME. Outta here, nolimit.

[Left Coaster]

No sympathy asked for or needed...but I did go back and count the company failures...including the CAIL merge it's 5...and it includes larger carriers that fell under the AC bus (Lots blame the govt for believing the AC lobbyists) And certainly life would have been different if staying in Canada was even an option, which for a big number of expat Canuckleheads, it wasn't. Some are just now heading back for corporate gigs, or that (used to be) KAL commuting job...which has fallen even farther down the list of decent employment than ever before, and the rest are resigned on staying wherever they are. I agree with the thread creep statement, it's what happens when opinions are listened to and when different experiences occur. You are clearly a loyal Canadian, as am I, and we wear our flag proudly. The airline industry is heading in the direction of the shipping industry and Rovenescu and the BoD and shareholders at AC see it as a bonus...we don't...the Sunwing practice of using foreign pilots is now getting the attention it deserves. The airline industry was warned some years back that it would follow the shipping crowd into the "offshoring" maelstrom, and no one paid much attention...except maybe the ME carriers who knew what they wanted and how to get it. My (and your salary) is tax free, can you find a job back home that gives the same amount of disposable income as a tax free income? It's hard to find...The hypenated argument is circular so I think we're both right...The AC slide is just gathering speed and though I really want to see it end well for all the groups...I just don't think it will...stay cool...it's hot out there!:p