Canada's Transat Inc. garners fresh bid for over C$1bn


Groupe Mach, a Montreal-based real estate developer, has offered to buy Transat Inc., owner of Air Transat (TS, Montréal Trudeau), which it said was the culmination of a process that began when it initially approached the leisure group in January. Mach offered CAD14 Canadian dollars (USD10.5) per share in cash, one dollar more than a CAD520 million (USD386 million) bid made by Air Canada (AC, Montréal Trudeau) last month. The unsolicited proposal is worth more than CAD1 billion (USD747 million), including debts not on the balance sheet, Mach said in a statement on June 4. "We are excited about the potential synergies between our companies in which the leading integrated international tourism model of Transat could be combined with Mach's vast experience in overseeing the construction, ownership and management of complex real estate development projects in a cost-effective manner and its ongoing initiatives at modernising the leisure travel experience," Vincent Chiara, president and chief executive of Mach, said in the statement. In its own statement acknowledging the bid, issued a few hours later, Transat said it had entered into a "30-day binding period of exclusive negotiations" with Air Canada that would expire towards the end of June, but qualified: "There is no assurance that a definitive agreement will be reached in relation to any proposed transaction." As part of its offer, Mach said it would keep Transat’s head office, executive team and centre of decision-making in Montreal. This is something the Quebec government has said it wants to ensure, and the new offer is conditional on Quebec providing "approximately" CAD120 million dollars (USD89.7 million) in financing, while Mach also pledged that no jobs would be lost in the deal, Bloomberg reported. Transat can withdraw from the exclusive talks with Air Canada, according to the terms of this offer, if it receives an unsolicited proposal that is at least CAD1 per share higher than Air Canada's bid, and if the Canadian flag carrier does not then match it. 


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