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Sunday,  May 19, 2024 10:54 AM 

PKP says his offer to buy Transat is "still valid" after Air Canada deal falls apart

PKP says his offer to buy Transat is "still valid" after Air Canada deal falls apart
Quebecor President and CEO Pierre Karl Péladeau. (Quebecor)

Reacting to the termination of the arrangement agreement between Transat and Air Canada, Quebecor President and CEO Pierre Karl Péladeau has indicated that the previous proposal he filed in December 2020, through his management company Gestion MTRHP, remains valid. 

On Dec. 22, Mr. Peladeau (also known by his initials PKP) submitted a cash proposal to acquire Transat that was equivalent to $5 per share (approximately $190 million).

"This proposal is still valid and includes certain conditions that Mr. Peladeau wishes to lift quickly in order to remove the company from the state of uncertainty in which it has been for several months," stated a press release from spokesperson Annick Bélanger. 

READ MORE: Pierre Karl Péladeau still wants to buy Transat

The document also emphasizes that PKP is proposing a rigorous business plan focusing on sectors of the company with high-growth potential, job creation in Quebec, and on the development of the head office in Montreal.

"[The offer] ensures, by maintaining an independent Air Transat, a competitive market for the benefit of Quebec and Canadian consumers," said the press release.

PKP not surprised by the termination

Speaking precisely of competition issues, PKP said "it is no surprise" that Transat and Air Canada agreed to call off their transaction after the European Commission refused to approve it. 

“By purchasing Transat, being a direct competitor for the vast majority of transatlantic routes and "sun destinations," Air Canada would have captured more than 60% of the market, an unacceptable threshold that would have deprived consumers of competition in terms of prices," PKP said in an interview with TVA Nouvelles. 

Mr. Péladeau reiterated that he remains interested in acquiring Transat, praising the company.

READ MORE: Deal's off - Air Canada & Transat terminate arrangement agreement

“It's an exceptional brand. It is a brand for which Quebecers have an affection. It's a company that Jean-Marc Eustache built...and which has established itself in the airline industry here in Quebec, and it hasn't always been easy...Without any doubt, Mr. Eustache has created the winning conditions for continuity," he said, outlining his desire to remain in the Quebec aviation landscape.

"I think we will be very successful in the months and years to come," added Mr. Péladeau.

On Friday, after announcing the termination of their arrangement with Air Canada, Transat pointed out that it is now free to hold discussions with potential acquirers, including with Mr. Péladeau and his investment company. 

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