Air Canada just bought Transat for $520 million
Air Canada just bought Air Transat after a 30-day negotiation period.
The airline bought Transat A.T. Inc. for $13 a share, which values the company at $520 million.
Despite the merger, the airlines will still be run as separate brands and maintain their head offices in Montreal.
By approving the deal, Air Transat effectively turned down another offer from Group Mach Inc., a Quebec real estate group that was offering $14 per share.
Still, it's not quite a done deal. Shareholders and regulatory agencies will still have a say in the buyout, and people aren't happy that Canada's airline industry will be controlled by even fewer players than before.
Squash the competition and lower standards to AC’s level. Our “national airline” putting it to us again.— Austin (@austinphoto45) June 27, 2019
Some are also concerned that prices will increase and the quality of customer service will decrease.
If Air Transat backs out of the deal for any reason, such as to accept a better offer, they'll have to pay Air Canada a fee of $15 million.
And vice-versa, if the buyout can't go through because of regulatory issues, Air Canada will have to pay a fee of $40 million.
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