Air Canada has acquired Air Transat’s parent company Transat A.T. for an all-cash transaction of around $520 million at $13 per share – which means Canada’s largest and 3rd biggest airlines have joined forces.
Canada’s national carrier first approached the Montreal-based airline in the autumn. Air Transat will continue to maintain its head office and key functions in Montreal.
The deal was unanimously approved after an extensive review by the Special Committee of Transat’s Board of Directors who concluded the deal was in the best interests of the future of Air Transat.
Air Canada president and chief executive officer (CEO), Calin Rovinescu said: “Travellers will benefit from the merged companies’ enhanced capabilities in the highly competitive, global leisure travel market and from access to new destinations, more connecting traffic and increased frequencies.
“The Quebec economy will derive maximum advantage of having a Montreal-based, growth-oriented global champion in aviation, the world’s most international business.”
Transat president and CEO, Jean-Marc Eustache said the combination with Air Canada will give Transat new perspectives of growth, with the support of a strong network offering many options for connecting traffic.
He added: “This fully-funded cash transaction is the ideal platform for Transat’s presence and jobs in Montreal, and therefore represents the best option for all our stakeholders: employees, suppliers, partners and shareholders.”
The transaction remains subject to regulatory and shareholder approvals and other closing conditions usual in this type of transaction. If such approvals are obtained and conditions are met, the transaction is expected to be completed in early 2020.
Air Canada serves 11 airports across Quebec and served more than 10 million passengers in Montreal in 2018.
Montreal-based Air Transat is the third largest Canadian carrier operating a fleet of 38 aircraft to 63 destinations in 25 countries.