Air Transat reviewing multiple offers

[twochai]

https://www.theglobeandmail.com/business/article-transats-takeover-offers-send-stock-soaring-but-stoke-quebec/

With 7 A321-200's in service and the first of up to 15 A321NEO-LR's starting to deliver, Air Transat would nicely complement Air Canada's fleet.

[Willie Everlearn]

Quebecor is mulling over the idea of buying AT.

[twochai]

This should be interesting - a bidding war!

[twochai]

This should be interesting - a bidding war!
Great news for both companies!

[Jet Jockey A4]

Air Canada bought Air Transat according to different news outlets.

[er340790]

Hmmmmm.... one wonders if all that potential extra capacity might be related to the time AC expects the 737 Max issue to linger on....

Either way, bang goes another swathe of competition on the YYZ - Europe routes.

[standbykid]

Done deal, subject to approval...https://www.cbc.ca/news/business/air-canada-transat-deal-1.5192056

[+TSRA]

Done deal

I'd still wait to see what the competition bureau has to say before saying this is a done deal. Although the two airlines are slated to be operated separately, the bureau has seen this face before in situations where the competition was adversely affected. That's no bueno, and as much as most of us would like to see this happen, AC and AT might have to put on their convincing shoes here.

[er340790]

Well, in any first-world economy, no single company would be allowed to control over 60% of a given market (YYZ-Europe routes).

BUT, this being Canada, and in particular one small part of Canada, we all already know how this is going to play out...

Clue:

AC is headquartered in Quebec.

Air Transat is headquartered in Quebec.

Justin Trudeau, PM, is headquartered in Quebec.

Anyone expecting a rigorous monopolies investigation here is going to be sadly disappointed. A rigorous pretend-investigation, certainly. :rolleyes:

[bzh]

https://www.cbc.ca/news/business/transat-group-mach-1.5198909

no other buyer

[+TSRA]

BUT, this being Canada, and in particular one small part of Canada, we all already know how this is going to play out...

You're not wrong. But with an election coming up that will likely see our ever capable leader looking from the outside in, things would have to move quickly. I'm no lawyer so I ask honestly: Could WJ or SW object to a competition bureau decision until a more favourable government to their positions came into power?

[alioth]

It might just happen.

[Seat4A]

"MONTREAL, Aug. 11, 2019 /CNW Telbec/ - Air Canada and Transat A.T. Inc. ("Transat") announced today that Air Canada has agreed to increase the purchase price for the acquisition of all issued and outstanding shares of Transat, from $13 to $18 per share and have amended the Arrangement Agreement dated June 27, 2019 accordingly. Based on the increased consideration, the value of the all-cash transaction is approximately $720 million."


Full release here

https://aircanada.mediaroom.com/2019-08-11-Air-Canada-and-Transat-announce-Increased-Purchase-Price-to-18-per-Share-for-100-of-Transat-and-Lock-up-and-Support-Agreement-with-Transats-Largest-Shareholder-Letko-Brosseau

[Donkey497]

Do we have any more news yet?


I'd just like to know who I'll be booking my regular June flights with....

[Seat4A]

Do we have any more news yet?


I'd just like to know who I'll be booking my regular June flights with....


Transat posts Q3 adjusted profit ahead of Air Canada takeover

FlightGlobal - Sept 12, 2019

https://www.flightglobal.com/news/articles/transat-posts-q3-adjusted-profit-ahead-of-air-canad-460830/


Otherwise from CTV New - Sept 12, 2019

Quote:

Transport Canada has said it will conclude its assessment of the transaction by May 2, 2020."

Full article https://www.ctvnews.ca/business/transat-loss-more-than-doubles-as-it-works-to-complete-air-canada-deal-1.4589768

[Donkey497]

Q2 2020?

we could be in a race to see what happens first Air Tranada or Flexit…….

[J.O.]

Q2 2020?

we could be in a race to see what happens first Air Tranada or Flexit…….
Flexit :confused:

[Donkey497]

Flexit
Flexible (date) + Brexit
Flexible + Britain + Exit (from European Union)

Journalists this side of the 'oggin seem to have developed a burning and increasing desire to combine acronyms.

No sooner had the EU announced that they'd agree to yet another extension, but this latest one had the flexibility to have an earlier end date, than I heard "Flexit" on three separate radio stations.

[rog747]

How is it that no international charter airline in Canada in my lifetime (since I saw Wardair's first jet in 1966) has ever survived without being gobbled up?

[Donkey497]

Well, now that we are past the May the 2nd date, have we heard anything further from Transport Canada on the deal going ahead or not? I guess that it's the proverbial racing certainty that I'm no longer wondering who I'll be booking my June flights with, it's now who I'll be booking with when we all get to travel again.
I may have just sneaked in my last true Transat flight in March just prior to lockdown, but I will be sorry to see them assimilated, if that is to be their fate.

[Mad (Flt) Scientist]

According to a story dated May 1 (Friday):
The transaction still requires approval of Canada’s Transport minister, Marc Garneau, though the nation’s competition regulator has voiced concern. European Union antitrust regulators are scheduled to decide on an agreement by May 25.

[Smurfjet]

According to a story dated May 1 (Friday):
...the nation’s competition regulator has voiced concern. European Union antitrust regulators are scheduled to decide on an agreement by May 25.
For someone not in the know, how does a foreign regulator get involved?

[Mad (Flt) Scientist]

Same as in many other cases - if the two companies have a market presence in a country (or supranational entity, in this case) then their actions are subject to review by that country. The US, the EU and China all routinely use this approach.

Otherwise, to make an extreme example, any two large companies could form a massive monopoly just by domiciling in different countries and each claiming that no-one except THEIR home regulator had the right to review the merger.

[Donkey497]

Woo Hoo!

Transat's Coming Back!!!

Air Transat Flight Resumption Announcement 11th June (https://www.transat.com/en-CA/corporate/media/news-releases/124315)

Let's see what the quarantine arrangements will look like at either end before we get too excited, though.

Might get my summer holidays after all........ In October?

[J.O.]

Woo Hoo!

Transat's Coming Back!!!

Air Transat Flight Resumption Announcement 11th June (https://www.transat.com/en-CA/corporate/media/news-releases/124315)

How many of their destination countries will reopen their borders to foreign travel this summer? My guess is you'll be able to count them on one hand.

[Donkey497]

Most borders are technically open and, despite perceptions, have never been actually closed, just restricted. [That's why there's newly arrived Texans currently roaming wild in Banff]


All you need to do is stay in the one place for two weeks once you get there...…. And then stay in another place for two weeks once you get back. Simples!

All you need to do is arrange your trip so that Duration > Quarantine, and that you work remotely on return.

[Seat4A]

https://cimg7.ibsrv.net/gimg/pprune.org-vbulletin/500x665/1ac_4c29f7d4512ce937092766c8a4f090bd3b823431.png


MONTREAL, Oct. 10, 2020 /CNW Telbec/ - Air Canada announced today that it has concluded an amended transaction with Transat A.T. Inc. that provides for Air Canada to acquire all the issued and outstanding shares of Transat and for its combination with Air Canada. Under the binding agreement, unanimously approved by the Board of Directors of Transat, Air Canada will acquire all shares of Transat for $5.00 per share, payable at the option of Transat shareholders in cash or shares of Air Canada at a fixed exchange ratio of 0.2862 Air Canada share for each Transat share (representing a price for the Air Canada shares of $17.47). The value of the transaction is approximately $190 million.

The amended transaction reflects the unprecedented impact of COVID-19 upon the global air transport industry, which has endured a severe decline in air travel since the initial Arrangement Agreement between Air Canada and Transat was concluded and approved by Transat shareholders in August 2019. The transaction remains subject to shareholder approval, court approval, the approval of the Toronto Stock Exchange, certain customary and other conditions, and regulatory approvals including the ongoing approval process of regulatory authorities in Canada and the European Union. If such approvals are obtained and conditions are met, the transaction is expected to be completed in late January or early February 2021.

"COVID-19 has had a devastating effect on the global airline industry, with a material impact on the value of airlines and aviation assets. Nonetheless, Air Canada intends to complete its acquisition of Transat, at a reduced price and on modified terms," said Calin Rovinescu, President and Chief Executive Officer of Air Canada. "This combination will provide stability for Transat's operations and its stakeholders and will position Air Canada, and indeed the Canadian aviation industry, to emerge more strongly as we enter the post-COVID-19 world."

The Transat Board of Directors has unanimously determined that the amended transaction is in the best interests of Transat and its stakeholders, and is recommending that Transat shareholders vote in favour of the transaction. In addition, each of the directors of Transat has entered into a voting support agreement pursuant to which each of them has committed to vote in favour of the transaction. Each of National Bank Financial and BMO Capital Markets has provided the Transat Board of Directors with an opinion to the effect that, as of the date thereof, the consideration to be received by holders of Transat shares with respect to the transaction was fair, from a financial point of view, to such holders, in each case subject to the respective limitations, qualifications, assumptions and other matters set forth in such opinions.

The transaction will be implemented pursuant to a court-approved plan of arrangement under the Canada Business Corporations Act. The new price of $5.00 per share represents a premium of 31.6% over the 20-day volume weighted average price (VWAP) of Transat shares on October 8, 2020.

All dollar amounts in this news release are in Canadian currency.


https://www.newswire.ca/news-releases/air-canada-and-transat-a-t-inc-conclude-amended-transaction-for-combination-of-the-two-companies-872396338.html

[Seat4A]

Additional details

https://cimg2.ibsrv.net/gimg/pprune.org-vbulletin/736x204/1ts1_0e08b55f67670bd0dccfcc49c6422fb75cf0acd1.pngMONTREAL, Oct. 10, 2020 /CNW Telbec/ - Transat A.T. Inc. ("Transat" or the "Corporation") announced today that it has revised its arrangement agreement with Air Canada to reflect current market and economic conditions and the devastating impact of the COVID-19 pandemic on the worldwide airline, travel and tourism industries. Under the terms of the binding agreement they have entered into, unanimously approved by the Board of Directors of Transat, Air Canada will acquire all issued and outstanding shares of Transat for $5.00 per share, payable at the holder's option either in cash or shares of Air Canada, or a combination thereof, to form a global Montreal-based combined company. The purchase price represents a premium of 31.6% over the 20-day volume weighted average price (VWAP) of Transat shares on October 8, 2020. Transat also announced today the implementation of a new $250 million short-term loan facility.

"With the volume now forecasted to be down 66% worldwide at the end of 2020, it is clear that the world has changed since the signing of the original agreement in June 2019," said Jean-Marc Eustache, President and Chief Executive Officer of Transat. "This is the worst crisis since the founding of Transat 33 years ago and with a second wave of the pandemic underway, the timing of an eventual recovery remains uncertain. More than ever, having a national airline with the scale to weather current industry turbulence, which is expected to continue for several years, is in the best interests of our shareholders, customers, employees and other stakeholders."

Given the uncertainty related to the COVID-19 pandemic, continuing restrictions on non-essential travel, and the impact to date of the pandemic-related interruption of operations on its cash position, Transat needed to put in place additional sources of financing. The terms of the original transaction restricted Transat's ability to do so without Air Canada's consent. As part of the negotiation leading to today's announcement, Transat has been able to implement a new $250 million short-term loan facility, as well as certain critical amendments to its existing senior loan facility providing Transat with additional flexibility in the context of the current business and economic environment.

"Securing Air Canada's consent to put in place the new loan facility was critical in the decision to revisit the terms of the original agreement with Air Canada" said Jean-Yves Leblanc, Chair of the Special Committee of the Board of Directors of Transat overseeing the process leading to today's announcement. "Another key factor in Transat's decision was the likelihood of obtaining the necessary regulatory approvals before the fast arriving deadline of December 27, 2020, taking into account the significant and adverse impact of the pandemic on Air Canada's original motivations for completing the transaction at the price set initially. Consummating the initial deal at $18.00 was not an option that was viable given the full set of circumstances the Corporation is facing", continued Mr. Leblanc.

The process of obtaining the required regulatory approvals for the transaction under the original arrangement agreement has been significantly and adversely affected by the pandemic and its impact on the industry as a whole. With the passage of time, the concerns raised by regulatory agencies and the challenges posed by the post COVID-19 environment, the Board of Directors of the Corporation came to the conclusion that the transaction proposed under the original arrangement agreement was unlikely to obtain the required regulatory approvals prior to the ultimate outside date of December 27, 2020 and was therefore unlikely to be consummated. "We believe that revised terms will provide the parties with greater incentives to address the concerns raised by regulatory agencies in order to obtain the regulatory approvals, including with respect to the offer of remedies which should provide a greater chance of obtaining the required approvals from regulatory authorities prior to the newly extended date of February 15, 2021," said Mr. Leblanc.

Based on the foregoing, Transat's Board of Directors determined that the revised transaction, with the implementation of the new financing, is the best prospect currently available for Transat's continued viability and the preservation of shareholder value relative to the alternatives available to it in the context of the original arrangement agreement, and therefore represents the best option for all Transat stakeholders, including shareholders, employees, creditors, suppliers, customers and partners.

The Transat Board of Directors, having received and considered the recommendation of its Special Committee of independent directors, and having considered all relevant factors including the terms of the original arrangement agreement and the status of the transaction contemplated thereby, has unanimously determined that the revised transaction is in the best interests of Transat and its stakeholders, approved the revised Arrangement Agreement and recommended that Transat shareholders vote in favour thereof. In addition, each of the directors of Transat has entered into a voting support agreement pursuant to which each of them has committed to vote in favour of the transaction.

Each of National Bank Financial and BMO Capital Markets has provided the Transat Board of Directors with an opinion to the effect that, as of the date thereof, the consideration to be received by holders of Transat shares with respect to the revised transaction was fair, from a financial point of view, to such holders, in each case subject to the respective limitations, qualifications, assumptions and other matters set forth in such opinions.

Additional Details about the Revised Transaction

The revised Arrangement Agreement terminates and replaces the original arrangement agreement between Transat and Air Canada dated June 27, 2019, as subsequently amended on August 11, 2019 pursuant to which Air Canada had previously agreed to acquire all issued and outstanding shares of Transat for a cash consideration of $18.00 per share.

Under the terms of the revised agreement, Transat shareholders will have the option to receive payment of the consideration in the form of cash or shares of Air Canada, or a combination of both. Air Canada shares issuable under the share payment election will be issued on the basis of a price of $17.47 per Air Canada share, translating into an exchange ratio of 0.2862 Air Canada share per Transat share. The price set for the Air Canada shares under the exchange ratio approximates the 30-day volume weighted average price (VWAP) of the Air Canada shares on September 23, 2020, the time the new cash consideration was in negotiation. Opting to receive shares of Air Canada provides upside opportunity by offering Transat shareholders the ability to participate in the potential long-term value created by Air Canada, and in the airline industry generally, in a post-Covid recovery environment, as well as sharing in the expected synergies resulting from the combination of the two companies.

The transaction will be subject to shareholder approval, including approval by at least two thirds of the votes cast by shareholders present in person or by proxy at the special meeting that will be called to approve the transaction in early December.

The transaction also remains subject to regulatory approvals, particularly those of authorities in Canada and the European Union. To this end, the parties are collaborating to provide information and make submissions to the regulatory authorities with the objective of securing the requisite approvals before February 15, 2021, which has been set as the outside date for the closing of the transaction. Based on information currently available, the European Commission's decision is now expected early 2021. The Government of Canada has not indicated when it would render its decision.

The terms of the revised Arrangement Agreement provide for a break fee of $10 million, payable by Transat in case of termination of the agreement in certain circumstances, including upon acceptance of a Superior Proposal that is not matched by Air Canada. Under the revised Arrangement Agreement, a Superior Proposal is defined, in part, as an unsolicited bona fide written acquisition proposal, that is made at a firm price per share equal to or exceeding $6.00 in cash, that has fully committed financing from a financial institution or similar organization (or is made by a person with adequate cash on hand), and that the Board of Directors of Transat determines in its good faith judgment, after receiving legal and financial advice, would result in a transaction that would be in the best interests of Transat and its stakeholders and be more favourable, from a financial point of view, to Transat shareholders. The terms and conditions for the making of a Superior Proposal and its complete definition are contained in the revised Arrangement Agreement. Furthermore, a break fee of $30 million would be payable by Transat if the agreement is terminated by Air Canada following a change in recommendation by the Board of Transat, which change would have been based on a governmental financial assistance program that is material to Transat becoming generally available to the Canadian airline industry or the segments of the travel, hotel and tourism industries in which the Corporation operates.

The revised Arrangement Agreement also provides for the payment by Air Canada of a reverse break fee of a maximum of $30 million in the event that the agreement is terminated because regulatory or governmental approvals are not obtained, subject to certain conditions.

Finally, the revised Arrangement Agreement contains a new closing condition that Transat's level of net indebtedness on closing not exceed a certain specified threshold.

In addition to shareholder and regulatory approvals, the transaction remains subject to court approval and other closing conditions usual in this type of transaction, and compliance with the revised covenants contained in the revised Arrangement Agreement (including with respect to the new requirement on Transat's level of net indebtedness on closing described above), all of which must be obtained or satisfied no later than February 15, 2021. If such approvals are obtained and conditions are met, the transaction is expected to be completed in late-January or early February 2021.

Further details regarding the terms of the transaction are set out in the revised Arrangement Agreement. The transaction will proceed by way of a court-approved plan of arrangement pursuant to the Canada Business Corporations Act. Additional information regarding the terms of the revised Arrangement Agreement and the background of the transaction will be provided in the information circular for the special meeting of Transat shareholders to be held in early December. Copies of both the revised Arrangement Agreement and the information circular will be made available on SEDAR at www.sedar.com (https://c212.net/c/link/?t=0&l=en&o=2946074-1&h=2741195382&u=http%3A%2F%2Fwww.sedar.com%2F&a=www.sedar.com).

Transat has retained National Bank Financial as financial advisor and Fasken as legal advisor. BMO Capital Markets and Norton Rose Fulbright are acting respectively as financial and legal advisors to the Special Committee of Transat's Board of Directors.

New Loan Facility

In connection with the revised Arrangement Agreement, Transat will immediately implement newly secured $250 million short-term loan facility with National Bank of Canada as lead arranger. Given the uncertainty related to the COVID-19 pandemic and continuing restrictions on non-essential travel, together with the uncertainty surrounding the obtaining of required approvals from regulatory authorities, securing this new financing is a necessary, prudent decision and in line with similar actions taken by nearly all airlines around the world.

The new loan facility can be drawn in tranches at any time before February 28, 2021, subject to meeting relevant conditions precedent and borrowing conditions. Conditions include certain requirements regarding freely available cash before and after drawing on the facility. The new loan facility will terminate on the earlier of March 31, 2021 and the closing of the arrangement with Air Canada.

As part of the implementation of the revised Arrangement Agreement and the new loan facility, Transat has also been able to implement certain amendments to its existing senior loan facility that will provide it with greater flexibility in the context of the current business and economic environment, including the temporary waiver of certain financial ratios. Revised terms also include the introduction of a minimum unrestricted cash level requirement and restrictions on the ability to incur additional debt.

Caution Regarding Forward-Looking Information.....

https://www.transat.com/en-CA/corporate/media/news-releases/124335

[Donkey497]

C$18 down to C$5.

Simply put - Ouch!!!

[Seat4A]

Feb 11, 2021, 17:31 ET Press Release

Government of Canada approves proposed purchase of Transat A.T. Inc. by Air Canada

https://www.newswire.ca/news-releases/government-of-canada-approves-proposed-purchase-of-transat-a-t-inc-by-air-canada-837971518.html

[Jet Jockey A4]

Feb 11, 2021, 17:31 ET Press Release

Government of Canada approves proposed purchase of Transat A.T. Inc. by Air Canada

https://www.newswire.ca/news-releases/government-of-canada-approves-proposed-purchase-of-transat-a-t-inc-by-air-canada-837971518.htmlToo little, too late...

After this pandemic is done (if ever) and flying gets underway, Air Canada won't need to buy AT because it like Sunwing will have gone bankrupt. Let us not forget that our incompetent Federal government did not help any airlines throughout the pandemic so I'm really worried they might not survive this.

In any case, I doubt that Air Canada will require/need all of the 650 AT pilots if the merger still goes ahead and if lucky perhaps only 150 pilots at AT will have jobs once this is all over. AT used to have prior to the pandemic roughly 120 flights a day and lately it was down to 20 flights a week and now with the latest coup de grace by Trudeau to discourage people from traveling with a 72 hour prior to departure COVID test before boarding the aircraft back home, then a new COVID test upon arrival in Canada followed by a mandatory 3 day stay in a supervised hotel for which the traveler is expected to bare all the costs in excess of $2000, I don't think AT (or Sunwing) will be around for a long time, not even sure Westjet will survive or perhaps Air Canada.

In any case I can see this country down to a one airline monopoly with fares sky rocketing and the Canadian tax payers holding the bag to bail out one or perhaps two airlines.

[Seat4A]

The Explanatory Note is an interesting read

https://tc.canada.ca/en/aviation/commercial-air-services/explanatory-note

[Seat4A]

Various sources

QUOTE:
"Both Air Canada and Transat have agreed to terminate the Arrangement Agreement with Air Canada paying Transat a termination fee of $12.5 million, and with Transat no longer under any obligation to pay Air Canada any fee should Transat be involved in another acquisition or similar transaction in the future."

Air Canada and Transat Mutually Agree to Call Off Deal

Travel Pulse Canada, Last updated: 12:13 PM ET, Fri April 02 2021 - JIM BYERS

Full Article
https://ca.travelpulse.com/news/airlines/air-canada-and-transat-mutually-agree-to-call-off-deal.html?fbclid=IwAR2AgJvpozh7UZdXohfMTDz2hyhpBAwq7wuSnusHH RT4YqBPhb0zWEe1FLs



Air Canada, Transat scrap acquisition agreement
Both companies said Friday they’ve mutually agreed to terminate the agreement.

Montreal Gazette, Publishing date: Apr 02, 2021- Frédéric Tomesco
brief info
https://montrealgazette.com/business/local-business/aerospace/air-canada-transat-scrap-acquisition-agreement


Air Canada ne mettra pas la main sur Transat

Radio-Canada
brief info
https://ici.radio-canada.ca/nouvelle/1781972/air-canada-air-transat-transaction-achat-annule

[Willie Everlearn]

Air Canada had 48% of the Canada-Europe market pre-pandemic and Air Transat had roughly 18% of the Canada-Europe market. It’s easy to understand why the EU wouldn’t want to approve this merger/buyout. Even I can see the imbalance in the proposal.
The potential of handing Air Canada 2/3rds of this market couldn’t have been all that appealing to the EU.
Debt payments for AT due the end of April could sound the death knell since the Canadian government doesn’t seem all that eager to come up with urgently needed industry assistance, financially or otherwise and Pelardeau’s offer (which is still on the table) simply falls short of what AT needs.
This won’t end well.

https://www.msn.com/en-ca/lifestyle/travel/transat-at-shares-plunge-in-first-trading-after-air-canada-pulls-plug-on-takeover/ar-BB1fjUEN?li=AAggFp5

Willie Everlearn

[fatbus]

But Trudeau will for the Quebec carrier , wait for it .

[Donkey497]

Woo Hoo!

Transat's Coming Back!!!

Air Transat Flight Resumption Announcement 11th June (https://www.transat.com/en-CA/corporate/media/news-releases/124315)

Let's see what the quarantine arrangements will look like at either end before we get too excited, though.

Might get my summer holidays after all........ In October?


..... Well maybe this year........ I was only 2 years out............. Hopefully!

[Donkey497]

Well so much for getting over to the land of Labbatt's, Poutine, Bear Claws, Timmys & Muskoka Chairs last October. Given the amount of rain we've had on this side of the pond I'm glad I decided to fix the house roof instead of go on a much needed holiday.


Anyhoo..... I'm going to atart a little thread drift here by asking if anyone knows if AT are still using the A321LR's for the GLA/YYZ route at any point over the summer?

I fancy giving the 321LR a try, but it just looks like the A330's on a constant rotation on the route. Ta much for any info.