Site icon IATA News

Previously Interested Parties No Longer Want Air Transat

Following the canceled merger with Air Canada last week, Air Transat finds itself in need of another investor. Unfortunately, those willing to place bids on the carrier back in 2019, say they are now no longer interested. The airline may need to place its hopes on an offer it rejected back in December, questioning the required level of financing.

Air Transat’s previous suitors are not rushing to put any new bids in. Photo: Vincenzo Pace | Simple Flying

Last Friday, Air Canada and Air Transat announced that they had agreed to terminate the merger they embarked upon in 2019. The deal fell apart due to failure to secure approval from the European Commission on the grounds that it would further consolidate competition between Europe and Canada.

Lost interest along the way

The airline is now caught in a precarious situation. While Air Transat has bravely stated that the termination of the agreement with Air Canada frees it to focus on relaunching operations, its survival hangs in the balance. One could have imagined that previously interested parties might be coming to the rescue. However, this does not seem to be the case.

As reported by the Financial Post, at least three potential bidders for the Montreal-based airline say they are currently not interested in acquiring it. This includes two buyers that previously expressed an interest in Air Transat.

Fellow Montreal company Groupe Mach, which put a bid in for a block of shares in 2019 in order to stop the sale to Air Canada, no longer wishes to acquire part of Air Transat. This despite having been contacted by third parties to put in a joint bid.

The failed deal with Air Canada has left Air Transat in limbo. Photo: Vincenzo Pace | Simple Flying

Not able to make it a success without a group

Financial services company FNC Capital brought together a group of investors two years ago and was preparing to make a joint offer. However, the willingness to put up all the money alone is not there.

“In the current context, FNC Capital alone has not what is required to make it a success,” Dominik Pigeon said in a statement to the Post. “Because of all these elements, Péladeau’s offer may be the best one today.”

One could wonder why the third party propositioning Groupe Mach does not go into business with FNC. Meanwhile, the offer of which Mr Pigeon speaks is that of Canadian businessman Pierre Karl Péladeau.

Canada’s second-largest carrier is decidedly not interested. Photo: Vincenzo Pace | Simple Flying

Péladeau’s offer

Mr Péladeau approached Air Transat in December, offering to pay CA$5 (US$3.98) per share. The airline’s board rejected it at the time as it was set to merge with Air Canada. It is unclear if the offer still stands, although as late as mid-February, Mr Péladeau reaffirmed his continued interest in the airline. Air Transat has most certainly reached out a hand, having previously questioned the required financing level, although it is unclear if any concrete talks are in the works.

Those vocally opposed to the Air Canada – Air Transat merger also do not want to throw their hat into the ring. The country’s second-largest airline, WestJet, also confirmed it has no interest in bidding for its smaller competitor.

Where do you think Air Transat will go from here? Who would be a good fit to take over control of the airline?



Source link

Exit mobile version