Air Canada will not eventually buy Transat. The two airlines announced today in press releases that they will terminate the arrangement agreement that provides for Air Canada’s acquisition of Transat.
As part of the termination of the agreement, Air Canada agrees to pay Transat a “$ 12.5 million termination payment and waive its right to a termination fee of $ 10 million in the event of termination. Transat is acquired by a third party within twelve months of terminating the agreement.” Ranking, ”reads Transat’s press release.
“Transat is free to conduct discussions with potential strategic and financial buyers, including Mr. Pierre Carl Bellado,” he said.
Air Canada and Transat entered into a takeover agreement in June 2019, the terms of which were subsequently revised in August 2019, and then revised in October 2020 due to the economic repercussions of the pandemic on the sector.
The latest takeover offer, which Transat shareholders backed last December, came to 190 million, or $ 5 a share – a drastically underrated circumstance compared to the 720 million expected before the pandemic that caused the collapse in air travel demand.
The two companies got the green light from Canadian authorities, but the acquisition remained conditional on European Commission (EC) approval.
To meet the Commission’s concerns about competition law, Air Canada states that it has “offered and improved upon a set of significant corrective measures” that go far beyond “what the European Commission has traditionally accepted in merger cases. From past airlines.”
However, the company believes that in light of recent talks, “it has become clear that the European Commission will not approve the acquisition under the treatment package currently offered,” according to the Air’s statement. Canada.
More details will follow.