Air Transat Now Has Two Suitors – Mach and Air Canada

Courtesy commons.wikimedia.org

Montreal – (CNW Telbec) – Group Mach Inc. (“Mach”), the largest independent real estate developer and owner in Quebec , wants to buy all issued and outstanding voting shares of Transat AT Inc. (TSX: TRZ) (“Transat”),  at a price of $14 cash per Share based on a deal value exceeding $1B.

The interesting twist in this story is that Transat wanted to reiterate that it has already entered into an agreement with Air Canada.

On Tuesday, Air Canada said that it is in the process of finalizing its binding agreement to purchase all of the issued and outstanding shares of Transat AT Inc. and its combination with Air Canada to create an industry leading, Quebec-based leader in the global leisure travel industry.

Air Canada announced on May 16, 2019 that it had entered into an exclusive agreement with Transat regarding the proposed transaction and that the agreement was subject to Air Canada completing a 30-day due diligence period now expected to be complete towards the end of June.

CUPE is already monitoring the potential purchase with Air Canada. That story is here.

The Transaction is subject to conditions:

  • Transat terminating its current process with Air Canada prior to entering into any definitive binding acquisition agreement with Air Canada;
  • The execution of a confidentiality agreement between Transat and Mach which includes a period of 30 days to complete due diligence and execute a definitive acquisition agreement;
  • The execution of a definitive acquisition agreement between Transat and Mach;
  • The Quebec Government providing acquisition financing of approximately $120,000,000, subject to terms and conditions to be negotiated between Mach and the Government. Mach shall file a business plan with Investissement Québec on or before June 10, 2019 (the “IQ Financing”);
  • The Fonds de solidarité FTQ (“FSTQ”) and the Caisse de dépôt et placement du Québec (the “CDPQ”) executing support and voting agreements with Mach; and
  • The receipt of regulatory approvals, namely the review of the Transaction by federal competition and transportation authorities.
Courtesy commons.wikimedia.org

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