AC and TRZ Agree to Terminate Arrangement

[rudder]

Stock at $12 dollars now. Transat would probably gone bankrupt this summer and could have been had for a song. What's the penalty for backing out of this deal?

AC breakup fee from original deal ($13/share June 2019) was $40 million.

Cannot find any public information to see if that changed in the final deal.

It is unlikely that AC will back out as they know that Gerry Schwartz/ONEX would likely pick it up at a grossly discounted price.

[altiplano]

I don't think Onex was ever seriously interested in Transat. But even if, now? Even less so.

Onex bought into the airline business at the top of the cycle and will take an immediate loss and be tangled up in it longer than they either wanted or expected.

I do not think throwing more good money after bad is a plan they will embrace.

TRZ down around $12? It seems the market is questioning whether AC still wants to throw in...

Might be better to preserve cash if this market fear is going to persist and bookings don't pick up.

If you believe the purchase will go through at $18 in the matter of months, seems like a good opportunity to pull in a 50% return... might be a good way to lose it all too though.

[rudder]

I remember when Robert Milton was quoted as saying that the best thing that ever happened at AC was losing the bidding war for Wardair to Canadi>n. Canadi>n ended up overpaying going in to a recession.

I wonder how AC feels now?

[derateNO]

I don't think Onex was ever seriously interested in Transat. But even if, now? Even less so.

Onex bought into the airline business at the top of the cycle and will take an immediate loss and be tangled up in it longer than they either wanted or expected.

I do not think throwing more good money after bad is a plan they will embrace.

TRZ down around $12? It seems the market is questioning whether AC still wants to throw in...

Might be better to preserve cash if this market fear is going to persist and bookings don't pick up.

If you believe the purchase will go through at $18 in the matter of months, seems like a good opportunity to pull in a 50% return... might be a good way to lose it all too though.

Honestly, Onex buying AT might have been the best thing for the pilots at AC.

Finally some real competition for jobs, and WB flying. Maybe it would have seen us get proper raises. That's how the american carriers keep going up, one gets a raise, the next beats them to get the pilots, and it's a never ending cycle.

In Canada everyone has a hard on for AC and they know it.

[altiplano]

I wonder how AC feels now?

You answered your own question.

overpaying going in to a recession.

[Daniel Cooper]

If they don't get out of this I expect CR's legacy will be this right move at the wrong time.

[FL-280]

Fingers crossed, they get out of this. Flights are empty right now. Last thing we need is more capacity

[derateNO]

Might be a good time to bail.

Given WJ is having issues I doubt Onex has the cash to burn on them anyways.

They just got a nice new payscale, and they all seem to like their jobs so let them keep them.

[WJ200]

I'd be extremely surprised if there wasn't a Force Majeure clause in the agreement between Air Canada and Air Transat. I think the market is thinking the same thing right now.

[Hangry]

They just got a nice new payscale, and they all seem to like their jobs so let them keep them.

Absolutely. Some of these TS remarks are pretty aggravating. Best thing is you won’t have to “endure” working for AC.

Good luck

[FL320]

It’s funny to see some of you guys so desperate to wish that the current situation turns your dreams into reality. What are you so afraid of?

[Fanblade]

It’s funny to see some of you guys so desperate to wish that the current situation turns your dreams into reality. What are you so afraid of?

Regardless of anyone’s preferred outcome. Investors are clearly starting to question the transaction. Fear based no doubt. But if this situation continues to worsen for even a few weeks, massive groundings will start as cash burn skyrockets. Contingency plans getting involked.

Don’t underestimate just how devastating this type of thing can be. Every single major in North America entered Bankruptcy after 911/SARS. The C3/Royal/Canjet merger was one of the straws that broke that back. They tried to extract themselves without success.

I went through SARS. This is getting far more extensive. Yesterday and today the announcements alone In my mind far exceed that experience.

I’m wondering if force ma·jeure is on the horizon.

I know the phrase is over used. But I will use it anyway. We are in uncharted territory. Airlines might go into survival mode. If so all bets are off.

Hence the Transat stock price.

In other words a Transat/AC merger could easily become a back burner issue to reassess after normalization.

[altiplano]

It’s funny to see some of you guys so desperate to wish that the current situation turns your dreams into reality. What are you so afraid of?

You should put all your savings into TRZ stock.

It's been under $10 today, on a transaction that's supposed to close in a few months at almost double that... What are you so afraid of?

[Fanblade]

https://business.financialpost.com/tran ... anadas-bid

If you like the risk. Here is a buying opportunity.

And honestly if this just blows over then this is a great buy. If it doesn’t quickly blow over.....

Currently travel insurance companies are slowly starting to declare Covid a known situation that is not insured. IOW travel medical insurance doesn’t exist for it. For me personally that means no longer leaving the country for pleasure.

I think the news of the last two days is going to tank bookings and AC with be forced to announce contingency plans to quell shareholder fears.

But if you have nerves of steal. Can sleep at night as this will get worse yet. You might want to consider a buy.

[ToolShed]

Financial advice from a pilot. (shakes head)

Let me remind you of flying Parachuters for free and flying the exact same plane for less money (Rouge).

Never ever listen to a pilot in regards to finance and career advice.

[GATRKGA]

It’s funny to see some of you guys so desperate to wish that the current situation turns your dreams into reality. What are you so afraid of?

You should put all your savings into TRZ stock.

It's been under $10 today, on a transaction that's supposed to close in a few months at almost double that... What are you so afraid of?

What about AC stock? Didn’t it plummet even more percentage wise than TRZ?

For what it’s worth, the stock price doesn’t dictate the price of the transaction. Because unlike most pilots, businessmen don’t process acquisitions with the same mindset alike pilots who think short term, financially speaking. This AC trz acquisition is a long term game. The loss in slots alone and a brand that will fix your broken reputation is worth enough to still go through with it. Wether the pilots are deemed a surplus (which I think is what you’re hoping) is however a different story. And that, is to be determined.

WJ traded at 17 before it was announced to be purchased at 31. Trz was trading at dollar values way below today when it announced 13 per share from AC.

It’s not as simple as what you see in front of you.

[RRJetPilot]

I dont think Ac is letting go of Transat. Onex would sweep them up. Actually the pilots at Rouge better start practising their new call sign. Rouge's days are numbered now. Its actually pretty ironic how Rouge was trying to take out TS.

[Fanblade]

https://youtu.be/E3URhJx0NSw

This is just the start. Three weeks ago Italy was fine. Today they don’t have enough ventilators. Today Doctors are having to make a choice on who lives and who doesn’t. It’s barbaric. But reality.

Watch the video it’s good. Good in an informative way. Scary in another.

[altiplano]

It’s funny to see some of you guys so desperate to wish that the current situation turns your dreams into reality. What are you so afraid of?

You should put all your savings into TRZ stock.

It's been under $10 today, on a transaction that's supposed to close in a few months at almost double that... What are you so afraid of?

What about AC stock? Didn’t it plummet even more percentage wise than TRZ?

For what it’s worth, the stock price doesn’t dictate the price of the transaction. Because unlike most pilots, businessmen don’t process acquisitions with the same mindset alike pilots who think short term, financially speaking. This AC trz acquisition is a long term game. The loss in slots alone and a brand that will fix your broken reputation is worth enough to still go through with it. Wether the pilots are deemed a surplus (which I think is what you’re hoping) is however a different story. And that, is to be determined.

WJ traded at 17 before it was announced to be purchased at 31. Trz was trading at dollar values way below today when it announced 13 per share from AC.

It’s not as simple as what you see in front of you.

Exactly. The deal is $18, not what the stock was before, or what the financials or potential valuation of TRZ are now...

You mention the Westjet/Onex deal. Announced May 13 at $31 and the stock promptly went to, and stayed just under $31 right until the deal closed and the stock delisted. The market was confident that the deal was happening at $31 and it stayed there, that was what it was defined to be worth.

Screenshot_20200312-131521.png (509.65 KiB) Viewed 1534 times

That's not what is happening here.

The market is pricing the discount because they are concerned the transaction won't proceed as planned. The stock wasn't already at $17.90 because there was some uncertainty surrounding approvals, but now with broader economic concerns and a travel slowdown, the market is thinking that there is a chance Rovinescu might rethink going through with this or want to keep his unrestricted cash in his pockets to support a potential long term bear in the industry, and the TRZ price is reflecting that. That said, if the market thought it wasn't going to happen TRZ would be fully tanked, but I'd say it's maybe saying 50/50.

I'm not hoping anything regarding the pilots being surplus. I'm hoping AC deems the deal not beneficial, pays the break fee, and walks.

If the deal can't increase market share and revenues or decrease costs what's the point? Save your hundreds of millions. There is no way Onex acquires TRZ now. I don't think they ever were going to anyway.

[GATRKGA]

You should put all your savings into TRZ stock.

It's been under $10 today, on a transaction that's supposed to close in a few months at almost double that... What are you so afraid of?

What about AC stock? Didn’t it plummet even more percentage wise than TRZ?

For what it’s worth, the stock price doesn’t dictate the price of the transaction. Because unlike most pilots, businessmen don’t process acquisitions with the same mindset alike pilots who think short term, financially speaking. This AC trz acquisition is a long term game. The loss in slots alone and a brand that will fix your broken reputation is worth enough to still go through with it. Wether the pilots are deemed a surplus (which I think is what you’re hoping) is however a different story. And that, is to be determined.

WJ traded at 17 before it was announced to be purchased at 31. Trz was trading at dollar values way below today when it announced 13 per share from AC.

It’s not as simple as what you see in front of you.

Exactly. The deal is $18, not what the stock was before, or what the financials or potential valuation of TRZ are now...

You mention the Westjet/Onex deal. Announced May 13 at $31 and the stock promptly went to, and stayed just under $31 right until the deal closed and the stock delisted. The market was confident that the deal was happening at $31 and it stayed there, that was what it was defined to be worth.

Screenshot_20200312-131521.png

That's not what is happening here.

The market is pricing the discount because they are concerned the transaction won't proceed as planned. The stock wasn't already at $17.90 because there was some uncertainty surrounding approvals, but now with broader economic concerns and a travel slowdown, the market is thinking that there is a chance Rovinescu might rethink going through with this or want to keep his unrestricted cash in his pockets to support a potential long term bear in the industry, and the TRZ price is reflecting that. That said, if the market thought it wasn't going to happen TRZ would be fully tanked, but I'd say it's maybe saying 50/50.

I'm not hoping anything regarding the pilots being surplus. I'm hoping AC deems the deal not beneficial, pays the break fee, and walks.

If the deal can't increase market share and revenues or decrease costs what's the point? Save your hundreds of millions. There is no way Onex acquires TRZ now. I don't think they ever were going to anyway.

Your whole Post is as speculative as a day trader on stock twits.

Thanks for the imagery alti.

I hope you get your wishes so you can feel good about your own sense of intelligence