ONEX plans

[Hugh Jasshole]

What are the chances that the deal will not go through??? That peckerwood with nice hair in Ottawa might not allow it so he can screw the west even more?

[aerobod]

What are the chances that the deal will not go through??? That peckerwood with nice hair in Ottawa might not allow it so he can screw the west even more?

Garneau was the first to approve the deal on 24 June, so the Feds don’t seem to have an issue.

A $200 million backout payment is due from Onex if they don’t complete the deal and the shareholders and Alberta court of Queens Bench have also approved as of last week. Not many hurdles left to pass now.

[Hugh Jasshole]

Just debating if I should wait to sell at the $31.00 buy out, or sell it now for $30.70. I would lose about 3k.

[kiaszceski]

It's basically how much you thrust ONEX on their plan and ability to make Westjet a real competitor to AC...
Personally I would wait to have more info on ONEX plan and the MAX, and whether they would shift or not to the A320 Neo and use the more they invested into a 787 order.
Don't forget the newly Joint Venture with Delta.

[aerobod]

It's basically how much you thrust ONEX on their plan and ability to make Westjet a real competitor to AC...
Personally I would wait to have more info on ONEX plan and the MAX, and whether they would shift or not to the A320 Neo and use the more they invested into a 787 order.
Don't forget the newly Joint Venture with Delta.

What Onex does post takeover has no bearing on the share price. Assuming the deal goes through, on completion before Onex assumes control all shareholders will be paid out at $31 (or the difference between $31 and strike price for options), whether they like it or not. Selling now up to the deal completion will yield the current trading price per share which Onex has no influence over. The market seems to think the deal is low risk of not going through, with the trading price only $0.29 to $0.23 below the deal price over the past week.

[x-wind]

Hey Jasshole,

M. Porter eluded to the option in investing in the new OneX WestJet with only the funds you'd be paid out otherwise for the ESP.

If you're feeling bullish about OneX building this company it could be a quick route to a millionaire eh?

[Hugh Jasshole]

I heard that ONEX was going to pay $36/share before the MAX deal. So Boeing owes us shareholders $5/share!!!! One of the directors at WJ believes that ONEX didn't want to buy us to keep us the second largest airline in Canada, but wants to make it number one?? They defiantly have the funds to do it.

[aerobod]

I heard that ONEX was going to pay $36/share before the MAX deal. So Boeing owes us shareholders $5/share!!!! One of the directors at WJ believes that ONEX didn't want to buy us to keep us the second largest airline in Canada, but wants to make it number one?? They defiantly have the funds to do it.

In the SEDAR initial filing the proposed deal value early in March before due diligence was complete was $35.75. The MAX fiasco certainly impacted that value, but other factors may have, too. $31 is still a very good valuation, as 92.5% of voting shareholders attested.

[cloak]

I agree that Onex has big plans for WestJet. It has been after having a major airline for over two decades and at least an many continents. There is no money in selling WestJet group in pieces. More importantly WestJet group as a whole is worth much more than the sum of its parts. It's also not going to try to get out of its financial obligations from the staff, especially the pilots since there is a shortage. In fact, one could argue that there may finally be a way to improve the fortunes of pilots at all companies of the group serving different segments of the market in a meaningful and negotiated way- even after the significant boost in share prices- as Onex may be looking for some latitude and freedom in certain parts of the agreement too. The winning formula will be to negotiate in private and negotiate well!

[cloak]

Cloak,
You seem pretty optimistic regarding Onex ownership of WJ.
Have you given any thought to the issue of pilot compensation. WJ pilots have enjoyed and benefited from a share purchase plan. It has formed a percentage of overall compensation since the inception of WJ. Some have done extremely well. Onex will probably not be offering the continuation of this program, as it dilutes their ownership. So, how does the reduction in compensation levels moving forward square with your optimism? I would be sceptical that Onex offers any type of pay raise or adjustment to the pilots to make up for the loss of the share purchase plan. It seems to me that Onex will simply wind up the program, keep existing salary levels,and try and move forward. If this occurs, then each pilot has essentially taken a 20 percent (or so) hit to their income.
Your thoughts?
Cheers.

ALPA is engaged. There is good opportunity for improvement and nurturing relationships.

[johnkruk]

How long will ONEX give Boeing to get the MAX in the air before they make the switch to NEO ?? I’m sure AC is kicking themselves for going With Boeing !!!

[kiaszceski]

It’s really how much they would lose by waiting for the MAX vs how much it would cost to shift to airbus maintenance , Airbus trained pilot...

[goingnowherefast]

I predict some very very cheap new 787s and/or max orders in WJs future.

[fish4life]

Everyone seems to think that companies can just “switch” to the neos... its not like buying a car where airbus has 1000 neos sitting on the lot in case someone wants to buy a few

[lownslow]

its not like buying a car where airbus has 1000 neos sitting on the lot in case someone wants to buy a few

Boeing, on the other hand...

[KAG]

I like making wagers, I'm usually wrong but it doesnt stop me
Anyway, Onex takes over anyday now, 3-6 months of feeling things out, then a managment cleaning. Meanwhile delta JV gets US approval, Delta personal appointed to BOD and upper WJ management within 6 months. Eventually onex sells 49% equity stake to Delta.
Ramp up of wide body ASAP.
Swoop....no clue. I dont believe for a minute it's making money, but it is dissuading other ulccs from market. Again no clue there.

2019-08-03-09-14-56.jpg (68.72 KiB) Viewed 7533 times

Encore: status quo. Hopefully fix compensation to retain crew.

As for compensation no paycut here. Yet. It's a money shuffle. 10% of the 20%esp funds is going to a pension. That leaves 10% remaining and option value - That's currently being negioated.
No one knows what the next downturn will happen or look like. I think itll be bad. Who knows what will happen to Onexs plans. Either way general feeling is of optimism.

[Sharklasers]

The Delta Airline Pilots are a real pilot group with a 70 year history of successfully organizing and negotiating.

http://www.alpawatch.org/PDF%20C2015/Ne ... 0Scope.pdf
http://dalscope.org/

Delta pilots have strong JV scope language and a history of enforcing it. Basically it says that the growth in the flying done by a JV partner cannot come at the expense of the Delta pilots. To the westjet pilots who think a JV will allow them to eat the Deltas pilots lunch and start doing a substantial chunk of their wide body flying you are in for a big disappointment. Real contracts don’t allow that.
I suspect the JV will be no different then the half dozen current JVs or enhanced codeshares currently being done by AC or the hundreds of JVs around the world.
The Delta pilots won’t lay down and die and if you aren’t taking traffic off their network where will all the passengers that will fill your 100 widebodies come from?

[mbav8r]

I like making wagers, I'm usually wrong but it doesnt stop me
Anyway, Onex takes over anyday now, 3-6 months of feeling things out, then a managment cleaning. Meanwhile delta JV gets US approval, Delta personal appointed to BOD and upper WJ management within 6 months. Eventually onex sells 49% equity stake to Delta.
Ramp up of wide body ASAP.
Swoop....no clue. I dont believe for a minute it's making money, but it is dissuading other ulccs from market. Again no clue there.


2019-08-03-09-14-56.jpg
Encore: status quo. Hopefully fix compensation to retain crew.

As for compensation no paycut here. Yet. It's a money shuffle. 10% of the 20%esp funds is going to a pension. That leaves 10% remaining and option value - That's currently being negioated.
No one knows what the next downturn will happen or look like. I think itll be bad. Who knows what will happen to Onexs plans. Either way general feeling is of optimism.

Delta cannot take a 49% stake, ownership rule prevent that.

“While the definition of “Canadian” in the Canada Transportation Act still requires that a corporation or entity be controlled in fact by Canadians (a.k.a. de facto control), the long-standing requirement that at least 75% of the voting interests be owned and controlled by Canadians (a.k.a. de jure control) is reduced to 51% where:

(a) no more than 25% of the voting interest are owned directly or indirectly by any single non-Canadian, and
(b) no more than 25% of the voting interests are owned by one or more non-Canadians authorized to provide an air service in any jurisdiction.”

[KAG]

Shark, I dont think we'll be doing much wide body delta flying but maybe some lower yield transborder flying, and get some left overs. Some more flying, a equity stake and leadership is what I'm hopeful for.

[plhought]

Everyone keeps praising this Delta "Joint-Venture" as some sort of magic that's going to change everything and bring in big bucks.

Someone needs to break it down for me and explain what's the difference between this joint venture and a codeshare.

To me it sounds just like any other airline "alliance" ala Star Alliance or One World. Just a bunch of marketing/baggage/codeshare/interline/lounge agreements. Big woop.

Like has Delta bought a chunk of WJ or what?

I can't see Delta dumping it's transborder mainline flying to WJ in any great volume. I don't think it's pilots would be to happy about that. Maybe some of the transborder stuff flown by it's regional partners perhaps. But would WJ really be enthused about flying routes that usually only fill 50-70 seats?