Air Canada lowers Transat buyout price to reflect COVID-19 hit

Air Canada lowers Transat buyout price to reflect COVID-19 hit

FILE PHOTO: Calin Rovinescu, CEO of Air Canada speaks during a panel discussion on Cyber Security a
FILE PHOTO: Calin Rovinescu, CEO of Air Canada speaks during a panel discussion on Cyber Security at the 2016 International Air Transport Association (IATA) Annual General Meeting (AGM) and World Air Transport Summit in Dublin, Ireland June 3, 2016. REUTERS/Clodagh Kilcoyne/File Photo

REUTERS: Air Canada has lowered its price to buy Canadian tour operator Transat AT with the deal now worth about C$188.7 million (US$143.86 million), down from US$720 million previously, reflecting the post-COVID-19 reduction in airline values, the companies said in a statement on Saturday (Oct 10).

Air Canada had secured Transat shareholders' approval for the deal last year with a sweetened C$18.00 a share bid, to bolster its leisure business.

Under revised terms of the deal, Air Canada said it will acquire all shares of Transat for C$5 per share, representing a premium of about 30.5 per cent to Transat's last close on Friday.

"Air Canada intends to complete its acquisition of Transat, at a reduced price and on modified terms," Calin Rovinescu, chief executive officer of Air Canada said in a statement.

The deal remains subject to shareholder approval, court approval and other regulatory approvals in Canada and the European Union, Air Canada said.

Source: Reuters

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