Air Canada and Transat have mutually agreed to terminate an arrangement agreement that would have seen Transat acquired by Air Canada.

In a media release from Air Canada, the originally agreement occurred back in June of 2019 with amendments in August of that year and more revisions in October of 2020 due to COVID-19. The acquisition, Air Canada says was conditional on the approval of various regulatory authorities, including the European Commission. Air Canada suggests despite providing a significant package of remedies, the EC would not approve the acquisition, and claims that additional remedies would compromise Air Canada’s ability to compete internationally.

Both Air Canada and Transat have agreed to terminate the Arrangement Agreement with Air Canada paying Transat a termination fee of $12.5 million, and with Transat no longer under any obligation to pay Air Canada any fee should Transat be involved in another acquisition or similar transaction in the future.

(BDJ – April 2, 2021)