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Bloomberg
Air Canada boosted its takeover offer for Transat AT by 38 percent, or C$200 million ($151 million), securing support from the tour operator’s largest shareholder in the process.
Air Canada said it will raise the bid to C$18 a share from C$13, bringing the value of the all-cash offer to C$720 million. The sweetened offer has the support of Letko Brosseau & Associates Inc, which owns about 19 percent of Transat’s shares and had opposed the deal. Transat soared 41 percent to C$16.60 in Toronto. Air Canada dropped 1 percent.
The higher bid is an attempt to fend off an unsolicited offer from Group Mach Inc, a Quebec real-estate developer that’s offered to buy at least 6.9 million of Transat’s Class B shares, or about a fifth of the company, for C$14 a share.
“We are very pleased with the added stability brought about by Air Canada’s increased bid as supported by Transat’s largest shareholder, Letko Brosseau,†Transat Chief Executive Officer Jean-Marc Eustache said in a statement.
The break fee payable by Montreal-based Transat if the agreement is terminated was also increased to C$40 million from C$15 million.
Shareholders will be asked to vote on the competing offers at a special meeting on August 23.