In a move that will reduce competition in domestic air travel in Canada to only two significant carriers, the PWA Corporation announced today that it planned to acquire all outstanding shares in Wardair Inc. of Toronto.
The offer of $17.25 a share ($14.40 in United States currency) has been valued at $248 million ($207 million) and was accepted by Wardair's founder and controlling shareholder, Max Ward, a former bush pilot. Wardair's class A shares soared $7.25, ($6.05) today, to $15.875, ($13.25) on the Toronto Stock Exchange.
The deal, announced by PWA, owner of Canadian Airlines International, will end a campaign by Wardair, using cut-rate fares, to challenge Canadian Airlines and the state-controlled carrier, Air Canada.
In addition, the deal is expected to hasten moves by the Canadian Government to sell its 55 percent stake in Air Canada. Some industry analysts expect a new share offering to come later this year.
Established in 1953, Wardair pioneered the air transport of heavy equipment in Canada's Far North. In the 1960's and 1970's the airline grew rapidly as a charter operator to Europe. But it ran into financial difficulties in the last two years as Mr. Ward fought to turn the airline into a scheduled carrier.
At a news conference in Toronto, Mr. Ward said that recent losses had forced the sale. ''We had cash-flow problems that were going to catch up with us,'' he said.
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That's actually what happened...sorry for the the drift. As for Mr Saretksy and his foibles at WS, he ran into a problem when he attempted to put his greasy paws on the culture and make it his own...pushed too hard and too far and look what he got.