Pierre Karl Péladeau, president and chief executive of the media and telecommunications company Quebecor, has said he still wants to buy tour operator Transat AT through his investment firm Gestion MTRHP. He made the comments after Air Canada (AC, Montréal Trudeau) refused to extend a February 15 deadline for its CAD188.7 million (USD148.7 million) purchase of the Air Transat (TS, Montréal Trudeau) owner.
Transat revealed in a statement on February 16 that the European Commission had failed to approve the deal, requesting additional information from the parties involved and postponing its decision to later in the first half of 2021.
February 15 had been set as “the outside date for the consummation of the arrangement” and its passing means that either Air Canada or Transat are entitled, at any time, to terminate the planned acquisition, the tour operator said.
“Transat and Air Canada are continuing their discussions regarding potential amendments to the arrangement agreement that may be required. In the context of such discussions, Transat has been informed by Air Canada that Air Canada will not agree to an extension of the current outside date,” it added, meaning that the deal has been thrown into limbo.
As previously reported, the Canadian government approved the proposed acquisition last week despite concerns that the move would reduce competition in key markets. Both Air Transat and Air Canada rouge suspended scheduled flight operations earlier this month.
Noting that Transat was now free to start negotiations with a new buyer, Péladeau - who has previously attempted to acquire Transat - said in a statement this week that he would “like to start discussions” with its management to allow the business to escape its “grave state of uncertainty.”
“By swallowing up Transat, which is a direct competitor for the vast majority of transatlantic routes and sun destinations, Air Canada would concentrate more than 60% of the market, an unacceptable threshold in any industry,” he elaborated.
Pointing to the fact that Competition Bureau Canada had also arrived at this conclusion, he accused Air Canada of wanting to “re-establish its monopoly of yesteryear to better reward its shareholders and not its customers and citizens.” “Competition tastes much better,” he said, as demonstrated by Quebecor’s takeover of telecoms firm Vidéotron in 2000.
François Legault, the premier of Quebec since 2018, who co-founded Transat in 1986, told journalists on the evening of February 16 that the province was looking at different scenarios for Transat, with or without Air Canada.
