Air Canada yesterday concluded a “definitive agreement” for the take over of Canadian tour operating and airline group Transat for C$520 million.

The deal for C$13 per share comes in the face of a rival C$14 per share bid for the operator of leisure airline Air Transat from real estate developer Group Mach earlier in June.

The Canadian flag carrier’s transaction remains subject to regulatory and shareholder approvals but is expected to be completed in early 2020.

The Transat board of directors “unanimously determined” that the Air Canada offer “is in the best interests of Transat and its stakeholders”, including its employees, clients, shareholders, partners and suppliers.

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Air Canada president and CEO Calin Rovinescu said: “We are delighted to have reached this definitive agreement to combine Transat with Air Canada to achieve the best possible outcome for all stakeholders.

“For shareholders of Transat and Air Canada, this combination delivers excellent value, while also providing increased job security for both companies’ employees through greater growth prospects.

“Air Canada intends to preserve the Transat and Air Transat brands and maintain the Transat head office and its key functions in Montreal.

“Travellers will benefit from the merged companies’ enhanced capabilities in the highly competitive, global leisure travel market and from access to new destinations, more connecting traffic and increased frequencies.”

Transat counterpart Jean-Marc Eustache said: “The combination with Air Canada will give Transat new perspectives of growth, with the support of a strong network offering many options for connecting traffic.

“This fully-funded cash transaction is the ideal platform for Transat’s presence and jobs in Montreal, and therefore represents the best option for all our stakeholders: employees, suppliers, partners and shareholders.

“For our clients, it will offer even more choices and possibilities. For now, they can continue booking their flights and packages with complete confidence, as all bookings will be honoured before and after the closing of the transaction.”

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