MONTREAL — Transat is being wooed by more than one company for a possible acquisition and has appointed a committee of independent directors to evaluate the proposals.
In the meantime, “this situation has no impact on the clients or employees of Transat, nor on its operations, which are continuing as usual,” says Transat.
If the committee gives the green light, Transat says it will make a formal review of strategic alternatives, consider any alternative proposal, and make recommendations to the Board of Directors in the best interests of the Corporation and all its stakeholders.
Transat adds that the discussions are at a preliminary stage. “No decision has been made as to any potential transaction. There can be no assurance that any transaction will take place. The Corporation does not intend to provide further updates or comments with respect to the foregoing except as required by law.”
The announcement came as the company held its annual meeting this morning in Montreal and prompted a 40%+ increase in Transat shares.
Last month Transat reported a Q1 loss of $49.6 million. The company says it was hurt by a rise in operating costs due to the weakening of the loonie against the U.S. dollar, higher fuel prices and additional costs related to the transition and optimization of its fleet.
In 2018 Transat announced it had purchased a parcel of land in Mexico’s Puerto Morelos, with a promissory agreement to purchase a second adjacent property, and says it is aiming to have its first resort open by November 2020.