Air Canada’s bid to buy airline and travel group Transat A.T. Inc is not a done deal yet, and it now has some competition to contend with.
A new bid has emerged from property developer Group Mach Inc, which has offered more than the Air Canada bid.
Its $14 per share offer at $527 million beats the Air Canada proposal but comes with a caveat.
It is hoping to get the Quebec government to fund 25% of the purchase price.
That may not necessarily be a deal-breaker as it has promised to keep all business operations and its leadership team in Montreal and there would be no layoffs.
"The airline for now is an integral part of that business, it’ll be important to keep that," said Group Mach Vincent Chiara.
Group Mach’s proposal also includes a minority stake by Spanish developer TM Grupo Immobiliario, which would transfer its three hotels in Mexico to Transat.
Transat responded by saying it expects to ‘finalize the negotiation of a definitive agreement’ with Air Canada before the 30-day exclusivity agreement expires this month, although it is leaving its option open.
"There is no assurance that a definitive agreement will be reached in relation to any proposed transaction," it said.
Air Canada has an option to meet Group Mach’s asking price.
