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Purchase of Transat | A clause provides for dismissals

(Montreal) In addition to a major transaction price revision, the new agreement between Transat AT and Air Canada includes a clause requiring the tour operator to rationalize its workforce before going into the care of the largest airline. in the country.

Posted Oct 15, 2020 at 12:59 PM

Updated at 4:22 PM

Julien Arsenault
The Canadian Press

According to a document filed with the regulatory authorities and currently available only in English, this restructuring, which will continue when all necessary approvals are obtained, should reflect the impact of the COVID pandemic. 19. The health crisis is still shaking the commercial aviation sector, which will take several years to recover.

In the absence of government support and the enforcement of current restrictions on international travel, Transat AT had already reported last September that there could be up to 2,000 layoffs – which could reduce the size of its workforce by 40%.

"There will be layoffs whether there is a deal or not," his spokesman, Christophe Hennebelle, explained in a telephone interview on Thursday, referring to information already made public. As long as we are certain that the transaction will take place, the plan will be

Air Canada did not comment on this clause of the new arrangement on Thursday afternoon.

Without prejudice to the number of employees who will be laid off, Mr. Hennebelle added that the tour operator hoped that "there is as little as possible. About 100 workers have lost all livelihoods since September.

Financial aid could ease layoffs, but the helicopter should fall anyway as there are no signs of recovery, Mr. Hennebelle, referring, among other things, to the closing of international borders.

Air Canada is now offering $ 5 for each share of Air Transat's parent company – a 72% drop from $ 18 previously. The value of the transaction would thus fall from 720 million to about 190 million. While regulatory approvals in Canada and Europe are still pending, the new version of the scheme is being pushed back to February 15, from December 27, the sale deadline. It also allows Transat AT to borrow up to EUR 250 million to stabilize its operations.

This proposal will be the subject of a new vote and must have the support of at least two thirds of the security holders. from Transat AT at a meeting scheduled for December 8

Waiting

Meanwhile, unlike other Quebec players who showed interest in Transat A.T last year, businessman Pierre Karl Péladeau has not closed the door to another attempt. Asked during a telephone interview with The Canadian Press regarding the relaunch of Téo Taxi's business, the latter cautiously claimed that he "continues to analyze the file".

a shareholder of Transat, said Mr. Péladeau. In this regard, I will look at the various (options) that are likely to be addressed. Maybe there will be another offer. I continue to analyze the file. Will shareholders be happy with (Air Canada) 's offer?

The controlling shareholder of Quebecor deplored the presence of a clause providing for layoffs in the new agreement and criticized Air Canada for asking Transat AT to "clean up" the company before closing the transaction.

] The new arrangement allows competitive bids to be submitted, but the enthusiasm is no longer among some of the contenders who had their eyes on the tour operator.

Tuesday, Groupe Mach, who owned the company last year not wanting to jump into the arena, while the businessman Dominik Pigeon, head of the firm FNC Capital, whose interest had also been mentioned, would have moved further.

In August 2019, before the shareholders of Transat AT said yes to Air Canada, Mr. Péladeau, who owns 600,000 shares of the tour operator according to the latest available information, had proposed a proposal la if the merger failed after rejection by the security holders or lack of required regulatory approvals.

Written by Rahis

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