Sale to Air Canada: $ 35 million for Tour Operator AT’s bosses
If it goes ahead, Air Canada’s offer to buy Transat AT will allow 23 senior executives, directors and other executives of the Quebec tour operator to share a sum of at least $ 35 million.
This is the consideration that will be paid to them in exchange for shares of the parent company of Air Transat as well as other financial instruments, such as options and other units on securities, which they hold.
This information is contained in the Transat AT Shareholders’ Information Circular – filed with the regulatory authorities on Tuesday – for the August 23rd Special Meeting to enable them to vote on the $ 13 per share offer. Air Canada.
In addition, the amount of $ 35.1 million does not take into account the severance payments totaling nearly $ 9.76 million that could be awarded to the five principal executives of Transat AT if they are shown the door once the transaction has been concluded.
“Compensation is paid if the person is fired and this is not automatic with the transaction,” said a spokesman for the Quebec tour operator, Christophe Hennebelle, during a telephone interview.
For example, Transat AT’s President and Chief Executive Officer, Jean-Marc Eustache, is eligible to receive close to $ 11.7 million, or $ 5.55 million for his shares held and $ 6.1 million for options and other bonuses. He would also be entitled to a bonus of $ 5.5 million if he leaves the company.
In addition, a $ 15.6 million salary was paid for the retirement of the 71-year-old executive, who was one of the founders of the company created in 1987.
The solicitation circular contains many details, including the negotiation process and the many steps that led to the announcement of an agreement with Air Canada on June 27.
In particular, it was reported that Transat AT considered that the airline’s offer offered more stability than the Mach Group, which has flayed the Quebec tour operator’s advice in recent weeks.
In addition, at one point, Air Canada lowered its bid to $ 11.50 for each share of Transat AT, citing its poor financial performance. The offer price was reduced to $ 12.50 on May 9 and $ 13 three days later.
For its part, Mach initially proposed $ 9 to $ 10.50 for each share of the Quebec tour operator before moving its offer to $ 14 per title last June, in an announcement made by press release.
Transat AT stresses in the document that the Quebec real estate developer has, at no time, provided evidence of an “adequate level of liquidity, sufficient cash or a firm financial commitment”.
“Mach has also not demonstrated its business plan or demonstrated that it has the capabilities, experience and expertise to successfully carry out its business,” he says. we also read.
The owner of Air Transat stresses that “competition is fierce” in the sectors where it is present, particularly in those of air transport and tour operators.
Thus, the special committee of Transat AT believes that it is Air Canada that offers “the best opportunity to maintain jobs in the long term, especially for (…) pilots, mechanics and flight attendants”. Transat AT has some 5,000 employees.
Companies in this news: (TSX: TRZ, TSX: AC)