Despite the approval obtained from the federal government yesterday, Air Canada could very well – without any penalty – choose to abandon the acquisition of Transat AT as early as next week.
• Read also: Ottawa approves sale of Transat to Air Canada
This is because the purchase agreement binding the parties had provided for an exit door for the purchaser in the event that the desired transaction at the time was slow to be ratified. As a precaution, a deadline was set for February 15, 2021, next Monday.
Beyond this date, confirmed to us Christophe Hennebelle, vice-president of Transat, Air Canada would be entitled, at any time, to turn its back on the transaction and renounce the acquisition of the tour operator, without any penalty or obligation that it is towards the Montreal group.
The end of Transat?
“I have a hard time seeing how the Transat group could survive [à un tel scénario], reacted in an interview last night the UQAM professor and industry specialist, Mehran Ebrahimi. It hurts to say it, but it could very well mean the death of Air Transat. ”
At the time of going to press, Air Canada management had yet to formally respond to the green light granted by the new Federal Minister of Transport, Omar Alghabra. The carrier is due to present its latest quarterly results on Friday morning. Some hope that management will take the opportunity to give an indication of its intentions.
Waiting for Europe
Ottawa has given its approval to the acquisition of Transat by Air Canada, at a cost of $ 190 million, despite strong reservations expressed last year by the Competition Bureau. “Given the devastating consequences of the COVID-19 pandemic on the airline industry, Air Canada’s proposed acquisition of Transat AT will bring greater stability to the Canadian air transport market,” said Minister Alghabra .
The federal green light comes with a series of conditions, including the obligation to “maintain” the head office and the Transat brand in Quebec, the maintenance of at least 1,500 workers in the leisure travel sector, the “commitment” to “give priority to contracts signed in Quebec” for the maintenance of Transat aircraft, the establishment of a “price monitoring mechanism”, as well as the establishment of links to “ new destinations ”over the next five years.
Remember that the acquisition has yet to be approved by the European Commission, which suspended its examination just before the holidays. Mr. Hennebelle, of Transat, does not expect the Commission to render its decision by the deadline.
With the collaboration of Sylvain Larocque.
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