Here are some important flight news from Canada.
Air Canada’s Air Transat acquisition halted
That is today Announced That Air Canada and Air Transat have mutually agreed to terminate their acquisition agreement.
It was first announced in June 2019 Air Canada will purchase Air Transat 20 to 520 million. However, this agreement was significantly amended in October 2020, and as a result of the corona virus infection Air Canada reduced the purchase price by 72%, for 190 million.
I think Time worked well for Air Canada in this regard. Both airlines had issues with regulatory approval, so since the acquisition has not been finalized, it could be negotiated again.
The acquisition was conditional on the approval of various regulatory authorities, including the European Commission. It has now been decided that the European Commission will not approve the acquisition under the current terms. Air Canada considers the offer to “significantly compromise” the ability of the internationally competing carrier, so the deal is no longer worthwhile for Canada’s largest airline.
If the deal is terminated, Air Canada will pay Air 12 Trans.5.5.5 million in layoff fees.
Air Canada will no longer buy Air Transat
What does this mean for the future of Air Transat?
This is not to say that the aviation industry has changed significantly over the past year, and that the recovery path for both airlines will be long (especially as Canada’s travel restrictions are endless). I think the big question now is what Air Transat is, because last year the airline spent in anticipation of being acquired by Air Canada.
Will Air Transat survive as an independent airline with additional investments? Can WestJet go faster and try to get an Air Transat? I think it will be very soon to know how this is going to work, but it will definitely be interesting.
Only time will tell what the future holds for Air Transat
Air Canada’s Air Transat acquisition halted. Paradoxically this was not due to any issue with the Canadian regulators, but rather to the concerns of the European Commission. On the surface, European regulators are sure to have gone a little farther here, especially when you consider the poor state of the aviation industry.
Only time will tell whether Air Transat is independent, or whether the aircraft has now become a target for acquisition of WestJet aircraft, or another airline.
What are you doing about the termination of the Air Canada and Air Transat deal?