MONTREAL — Announcing its Q2 results yesterday, Transat said that while it was aware of Group Mach’s interest in the company, it hadn’t yet received a proposal. Now Group Mach has announced it will rectify that, with a formal offer coming before Transat’s exclusive talks with Air Canada end on June 26.
“We will file one, because they’re asking for one,” said Group Mach Inc. chief executive Vincent Chiara. “We don’t have any obligation toward Air Canada to respect an agreement.”
Transat continues to negotiate with Air Canada as part of a 30-day exclusive due diligence period, set to wrap up June 26. Air Canada is offering $13 per share in a $520 million deal, while Group Mach has said it will pay $14 per share, about $527.6 million.
Group Mach needs the Quebec government to kick in nearly one-quarter, or about $120 million, of the purchase.
For its bid Air Canada has pointed out that it “has all necessary funding to complete the transaction and therefore it is not subject to financing conditions and does not require government or taxpayer assistance.”
Transat chief financial officer Denis Petrin said any further acquisition proposal communicated to the company before or after the end of the exclusivity period will be addressed by Transat’s board of directors “in consideration of their duties and obviously the agreement with Air Canada”.
Key to Group Mach’s deal is proposed minority partner TM Grupo Inmobiliario, a Spanish real estate developer that would roll over its three hotels in Mexico to Transat. Group Mach’s Chiara has criticized how Transat is handling its $750-million plan to develop a hotel chain in the Riviera Maya and the Caribbean.
Financial analysts meanwhile are favouring the Air Canada deal.