Air Canada Outbid

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Diadem
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Air Canada Outbid

Post by Diadem » Tue Jun 04, 2019 9:40 am

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ToolShed
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Re: Air Canada Outbid

Post by ToolShed » Tue Jun 04, 2019 9:51 am

Lol by $1
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Sharklasers
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Re: Air Canada Outbid

Post by Sharklasers » Tue Jun 04, 2019 10:00 am

ToolShed wrote:
Tue Jun 04, 2019 9:51 am
Lol by $1
$1 a share. So about 41 million dollars....
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rudder
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Re: Air Canada Outbid

Post by rudder » Tue Jun 04, 2019 10:02 am

Lock up agreement gives AC first right to match offers up to $14.
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snowcone
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Re: Air Canada Outbid

Post by snowcone » Tue Jun 04, 2019 10:12 am

Is Transat even allowed to entertain offers right now? Sounds like bargaining in bad faith.

Oh ya. And the under funded real estate company wants the Quebec government to fund the deal. Nice!
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tsgas
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Re: Air Canada Outbid

Post by tsgas » Tue Jun 04, 2019 11:20 am

snowcone wrote:
Tue Jun 04, 2019 10:12 am
Is Transat even allowed to entertain offers right now? Sounds like bargaining in bad faith.

Oh ya. And the under funded real estate company wants the Quebec government to fund the deal. Nice!
In the PRQ socialism always overrides capitalism.
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TSAM
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Re: Air Canada Outbid

Post by TSAM » Tue Jun 04, 2019 11:32 am

snowcone wrote:
Tue Jun 04, 2019 10:12 am
Is Transat even allowed to entertain offers right now? Sounds like bargaining in bad faith.

Oh ya. And the under funded real estate company wants the Quebec government to fund the deal. Nice!
TS is in exclusive talks with AC, meaning TS can't approach others, but others can approach TS. This offer is an unsolicited one. After the 30 days, TS can either accept AC offer or go with another. If TS were to accept the Mach offer today, TS would pay 15 mil to AC.
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TSAM
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Re: Air Canada Outbid

Post by TSAM » Tue Jun 04, 2019 1:37 pm

According to another article, it shares more light on the new proposal.
The Transaction is subject to conditions, namely the following:

Transat terminating its current process with Air Canada prior to entering into any definitive binding acquisition agreement with Air Canada
https://canadianaviationnews.wordpress.com/news/

*updated article link*
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Fanblade
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Re: Air Canada Outbid

Post by Fanblade » Tue Jun 04, 2019 4:28 pm

More serious an offer than I thought.

real estate developer and owner in Quebec proposes the acquisition of all issued and outstanding voting shares (the “Shares”) of Transat AT Inc. (TSX: TRZ) (“Transat” or the “Company”), at a price of $14.00 cash per Share (the “Offer Price”) based on a deal value exceeding $1B, including substantial off balance sheet debt which we estimate between $1.1B and $1.2B.

Looks like one of Transats current partners in Mexico doesn’t want to lose their partner.

Upon closing of the Transaction, TM Grupo Inmobiliario (“TM”), the largest residential and leisure real estate developer in Spain and preferred hotel supplier of Transat in Mexico, shall contribute, in exchange for a minority equity stake in Transat, approximately $15,000,000 in cash and roll-over its three operating hotels in Mexico with approximately 1,000 rooms under the well-established banner The Fives Hotels and Residences into Transat’s platform (the “TM Roll-Over”) thereby immediately generating approximately $15,000,000 of EBITDA for Transat;
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skypirate88
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Re: Air Canada Outbid

Post by skypirate88 » Tue Jun 04, 2019 4:38 pm

And conveniently 15 million was the number Transat was on the hook for if they walked away from AC
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Fanblade
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Re: Air Canada Outbid

Post by Fanblade » Tue Jun 04, 2019 4:46 pm

skypirate88 wrote:
Tue Jun 04, 2019 4:38 pm
And conveniently 15 million was the number Transat was on the hook for if they walked away from AC
I believe AT has the right to walk, without penalty, if an unsolicited offer beat the AC offer by a dollar. The thing is this offer may be worth far more than a dollar when considering the entire offer. I’m just going by the article but it says the offer is worth 1 Billion vs AC’s offer of 520m.
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tsgas
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Re: Air Canada Outbid

Post by tsgas » Tue Jun 04, 2019 4:55 pm

Fanblade wrote:
Tue Jun 04, 2019 4:46 pm
skypirate88 wrote:
Tue Jun 04, 2019 4:38 pm
And conveniently 15 million was the number Transat was on the hook for if they walked away from AC
I believe AT has the right to walk, without penalty, if an unsolicited offer beat the AC offer by a dollar. The thing is this offer may be worth far more than a dollar when considering the entire offer. I’m just going by the article but it says the offer is worth 1 Billion vs AC’s offer of 520m.
Transat would have to pay the penalty if AC matches the offer and is rejected.
The difference in your numbers is $520 million for the company + the debt = the $1 billion sum.
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Victory
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Re: Air Canada Outbid

Post by Victory » Tue Jun 04, 2019 5:57 pm

The acquiring firm's cost is both debt + equity of the acquired firm. AC can't buy Transat and not assume their debt. How would that work?
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Fanblade
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Re: Air Canada Outbid

Post by Fanblade » Tue Jun 04, 2019 6:06 pm

including substantial off balance sheet debt which we estimate between $1.1B and $1.2B.

This is the statement that has me wondering what it exactly means.
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Victory
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Re: Air Canada Outbid

Post by Victory » Tue Jun 04, 2019 6:20 pm

I believe aircraft leases are typically kept off balance sheet.
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tsgas
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Re: Air Canada Outbid

Post by tsgas » Tue Jun 04, 2019 7:43 pm

Victory wrote:
Tue Jun 04, 2019 6:20 pm
I believe aircraft leases are typically kept off balance sheet.
True but there has to be reserves for the mtce of the A/C and engines , prior to the A/C being returned at the end of the leases.
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laserstrike
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Re: Air Canada Outbid

Post by laserstrike » Tue Jun 04, 2019 9:37 pm

If anyone thinks a dollar a share is going to stop Calin if he really wants AT and the planes/pilots/routes, I have a bridge to sell you.
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flyinhigh
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Re: Air Canada Outbid

Post by flyinhigh » Wed Jun 05, 2019 11:49 am

I wouldn't worry about other offers to much.

https://aircanada.mediaroom.com/2019-06 ... -Companies
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iflyroads
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Re: Air Canada Outbid

Post by iflyroads » Wed Jun 05, 2019 12:18 pm

flyinhigh wrote:
Wed Jun 05, 2019 11:49 am
I wouldn't worry about other offers to much.

https://aircanada.mediaroom.com/2019-06 ... -Companies


Share holders would have to approve the AC offer.

Some might want to take the highest one as they will end up with more money.
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Fanblade
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Re: Air Canada Outbid

Post by Fanblade » Wed Jun 05, 2019 2:07 pm

iflyroads wrote:
Wed Jun 05, 2019 12:18 pm
flyinhigh wrote:
Wed Jun 05, 2019 11:49 am
I wouldn't worry about other offers to much.

https://aircanada.mediaroom.com/2019-06 ... -Companies


Share holders would have to approve the AC offer.

Some might want to take the highest one as they will end up with more money.
There is zero point participating in a bidding war from AC perspective. They will wait and then match/beat or hold their offer at deadline.

But your right the shareholders only care about $
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ogc
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Re: Air Canada Outbid

Post by ogc » Wed Jun 05, 2019 3:34 pm

Assuming this continues with AC what would the timeline look like?
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tsgas
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Re: Air Canada Outbid

Post by tsgas » Wed Jun 05, 2019 3:37 pm

Fanblade wrote:
Wed Jun 05, 2019 2:07 pm
iflyroads wrote:
Wed Jun 05, 2019 12:18 pm
flyinhigh wrote:
Wed Jun 05, 2019 11:49 am
I wouldn't worry about other offers to much.

https://aircanada.mediaroom.com/2019-06 ... -Companies


Share holders would have to approve the AC offer.

Some might want to take the highest one as they will end up with more money.
There is zero point participating in a bidding war from AC perspective. They will wait and then match/beat or hold their offer at deadline.

But your right the shareholders only care about $
Yes money bad , and socialism good . :rolleyes:
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Dry Guy
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Re: Air Canada Outbid

Post by Dry Guy » Wed Jun 05, 2019 4:07 pm

If they weren't shook by the other offer they never would have addressed it in the press release about why their offer is better.
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Babar350
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Re: Air Canada Outbid

Post by Babar350 » Wed Jun 05, 2019 4:09 pm

There is no assurance that the transaction will be completed as described in this news release or at all.
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lownslow
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Re: Air Canada Outbid

Post by lownslow » Thu Jun 06, 2019 4:57 am

laserstrike wrote:
Tue Jun 04, 2019 9:37 pm
If anyone thinks a dollar a share is going to stop Calin if he really wants AT and the planes/pilots/routes, I have a bridge to sell you.
I don’t think he wants it that bad, he just doesn’t want certain others to have it. If it’s deemed that an airline owned by a real estate firm poses no credible threat then their offer could come as a relief. AC now has the opportunity to save a half a billion dollars and whatever ongoing internal friction that would have caused. It will be interesting to see what happens next.
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