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

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


© Reuters. 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

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

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% 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.

($1 = 1.3117 Canadian dollars)

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