QFE Posted May 13, 2019 Share Posted May 13, 2019 Bnn reporting WestJet is being bought by ONEX. Link to comment Share on other sites More sharing options...
vrefplus5 Posted May 13, 2019 Share Posted May 13, 2019 They wanted AC back in the day as well. Link to comment Share on other sites More sharing options...
dagger Posted May 13, 2019 Share Posted May 13, 2019 Here's he release https://www.newswire.ca/news-releases/westjet-to-be-acquired-by-onex-847792523.html CALGARY, May 13, 2019 /CNW/ - WestJet Airlines Ltd. ("WestJet")(TSX: WJA) announced today it has entered into a definitive agreement that provides for its acquisition in an all-cash transaction. Under the terms of the agreement, Onex Corporation ("Onex")(TSX: ONEX) and its affiliated funds will acquire all outstanding shares of WestJet for $31.00 per share, after which WestJet will operate as a privately-held company. The purchase price represents a 67% premium to Friday's closing share price and a 63% premium to WestJet's 20-day volume-weighted average trading price. The transaction value is approximately $5 billion including assumed debt. "Since our first flight in 1996, WestJet has been singularly focused on providing better options for the Canadian travelling public and this transaction retains that commitment," said Clive Beddoe, WestJet's Founder and Chairman. "I am particularly pleased that WestJet will remain headquartered in Calgary and will continue to build on the success that our 14,000 WestJetters have created. Onex' aerospace experience, history of positive employee relations and long-term orientation makes it an ideal partner for WestJetters, and I am excited about our future." It's a fair bet Onex will turn around and sell part to a foreign investor - a lot neater than that foreign buyer operator being the largest shareholder in a diverse shareholder base.Yes, its 1999 all over again. Link to comment Share on other sites More sharing options...
dagger Posted May 13, 2019 Share Posted May 13, 2019 I'd guess that this will also be a big day for Air Canada shares Link to comment Share on other sites More sharing options...
QFE Posted May 13, 2019 Author Share Posted May 13, 2019 18 minutes ago, vrefplus5 said: They wanted AC back in the day as well. They also owned and made a nice profit with SKYCHEF. Link to comment Share on other sites More sharing options...
thinair Posted May 13, 2019 Share Posted May 13, 2019 Could Onex be the ones looking at Transat also? Does anyone recall why Onex didn’t get AC? Link to comment Share on other sites More sharing options...
rudder Posted May 13, 2019 Share Posted May 13, 2019 Likely that any employee incentive programs that are not codified in collective agreements are likely to be terminated. WJ was changing anyway. The culture is no longer a selling point for staff. As bad as it was at the bargaining table, the focus on the bottom line is going to be even more focused. ONEX does not disclose the financing for the cash portion of the deal. There will be incremental debt service costs going forward. Link to comment Share on other sites More sharing options...
Johnboy Posted May 13, 2019 Share Posted May 13, 2019 It's Deja Vu all over a gain. Only thing missing is Nigel Wright....official ONEX presser.... https://ir.onex.com/static-files/92bfa37b-1bb4-4fc8-8f31-f6da878d1b05 Link to comment Share on other sites More sharing options...
dagger Posted May 13, 2019 Share Posted May 13, 2019 23 minutes ago, thinair said: Could Onex be the ones looking at Transat also? Does anyone recall why Onex didn’t get AC? Westjet did supposedly make an offer for Transat, and AC was invited to counter and supposedly did, and there may be other bids on the table. Obviously the Transat board would like a bidding war. As for the Onex story back from 1999, it would take too much time for me to give you the full story. Suffice it to say that pairing with AMR to take out AC and merge it with Canadian was probably a mistake - it rallied strong forces against it, which produced a highly leverage counter proposal that topped ONEX and eventually resulted in the latter to drop its bid. That triggered such a wild timeline for AC - Milton, merger, bankruptcy, ACE... I wonder how history would have unfolded if CP had simply gone under. Would AC have stumbled along the line somewhere, run afoul of governments and regulators in other ways... Who knows. Link to comment Share on other sites More sharing options...
rudder Posted May 13, 2019 Share Posted May 13, 2019 AC may become more aggressive in its TRZ offer in response. Close doors on WJ expansion on the Atlantic from the east. AC is sitting in a ton of cash. Link to comment Share on other sites More sharing options...
dagger Posted May 13, 2019 Share Posted May 13, 2019 I wonder if ONEX would have the stomach to add even more debt to Westjet's balance sheet to fight AC or others on Transat AC stock opening up 4% Link to comment Share on other sites More sharing options...
internet Posted May 13, 2019 Share Posted May 13, 2019 What are the odds Delta takes a slice from Onex? Link to comment Share on other sites More sharing options...
dagger Posted May 13, 2019 Share Posted May 13, 2019 Just now, internet said: What are the odds Delta takes a slice from Onex? I'm figuring that someone might. Delta is the most logical from a US perspective. Link to comment Share on other sites More sharing options...
Geminoid Posted May 13, 2019 Share Posted May 13, 2019 1 hour ago, thinair said: Could Onex be the ones looking at Transat also? Does anyone recall why Onex didn’t get AC? Wasn't there something about the pension plan at AC that Onex didn't like/want? Link to comment Share on other sites More sharing options...
jackr Posted May 13, 2019 Share Posted May 13, 2019 39 minutes ago, dagger said: Westjet did supposedly make an offer for Transat, and AC was invited to counter and supposedly did, and there may be other bids on the table. Obviously the Transat board would like a bidding war. As for the Onex story back from 1999, it would take too much time for me to give you the full story. Suffice it to say that pairing with AMR to take out AC and merge it with Canadian was probably a mistake - it rallied strong forces against it, which produced a highly leverage counter proposal that topped ONEX and eventually resulted in the latter to drop its bid. That triggered such a wild timeline for AC - Milton, merger, bankruptcy, ACE... I wonder how history would have unfolded if CP had simply gone under. Would AC have stumbled along the line somewhere, run afoul of governments and regulators in other ways... Who knows. where'stheBEANWHENYOUNEEDONE Link to comment Share on other sites More sharing options...
dagger Posted May 13, 2019 Share Posted May 13, 2019 1 minute ago, jackr said: where'stheBEANWHENYOUNEEDONE Assuming he still has a lot of Westjet stock, the Bean is probably counting his profits today! He's still lurking here. Link to comment Share on other sites More sharing options...
thinair Posted May 13, 2019 Share Posted May 13, 2019 39 minutes ago, dagger said: Westjet did supposedly make an offer for Transat, and AC was invited to counter and supposedly did, and there may be other bids on the table. Obviously the Transat board would like a bidding war. As for the Onex story back from 1999, it would take too much time for me to give you the full story. Suffice it to say that pairing with AMR to take out AC and merge it with Canadian was probably a mistake - it rallied strong forces against it, which produced a highly leverage counter proposal that topped ONEX and eventually resulted in the latter to drop its bid. That triggered such a wild timeline for AC - Milton, merger, bankruptcy, ACE... I wonder how history would have unfolded if CP had simply gone under. Would AC have stumbled along the line somewhere, run afoul of governments and regulators in other ways... Who knows. Thanks, starting to remember now. There was a huge backlash from the AC employees as well. Merging with Transat would be a nightmare. C3 buying Royal was the anchor that pulled them under. AC can have em! Link to comment Share on other sites More sharing options...
Lakelad Posted May 13, 2019 Share Posted May 13, 2019 Yeah, there were a lot of moving parts, not the least of which was Quebec court ruling that upheld provision in original AC privatization act that no shareholder could hold more than 10% of shares, Schwartz walked away immediately after that. Link to comment Share on other sites More sharing options...
rudder Posted May 13, 2019 Share Posted May 13, 2019 Acquiring TRZ would give AC unprecedented capacity over the Atlantic. AC could use the consolidated 330 fleet for the sub 10 hour routes and reallocate the Boeing’s to the longer Atlantic routes and Asia/South Pacific. Devil is always in the details but I don’t see how this doesn’t work for AC. Link to comment Share on other sites More sharing options...
Specs Posted May 13, 2019 Share Posted May 13, 2019 1 hour ago, thinair said: There was a huge backlash from the AC employees as well. Schwarz said something negative to the effect of employees getting $250k for working 12 days a month. (He's gonna be a real big hit with the 'owners' at WJ). Link to comment Share on other sites More sharing options...
Super 80 Posted May 13, 2019 Share Posted May 13, 2019 I don't see how this improves any of the issues WestJet has been muddling through. I would imagine Schwartz is probably also the interested party behind the unsolicited Transat offer, I suppose he might also want to role Porter into Schwartzflot too. Link to comment Share on other sites More sharing options...
Super 80 Posted May 13, 2019 Share Posted May 13, 2019 1 hour ago, rudder said: Acquiring TRZ would give AC unprecedented capacity over the Atlantic. AC could use the consolidated 330 fleet for the sub 10 hour routes and reallocate the Boeing’s to the longer Atlantic routes and Asia/South Pacific. Devil is always in the details but I don’t see how this doesn’t work for AC. I'm skeptical that Air Canada would want very many of Transat's A330s in the first place. Link to comment Share on other sites More sharing options...
MD2 Posted May 13, 2019 Share Posted May 13, 2019 Imo the Onex deal back in 1999 would have produced better results than what ensued in the decade after for Air Canada post Milton era. The executives then out of pride fended off the offer with another offer highly leveraged (especially by foreign partner airlines)that saw them staying in charge. That proved to be a great financial burden. That was a different day. Today, this provides a good opportunity for WestJet, and contrary to some comments, may culminate in bringing its vision of becoming a global airline to reality. WestJet is a much better choice than Air Canada/Canadian would have been in 1999 for Onex because, as bad as some may think it is, it has far better labour relations than a merged Air Canada/Canadian would have had; it has far lower costs, stronger presence in the leisure market, a lot of room to grow, and on top of all, it knows how to make money. Link to comment Share on other sites More sharing options...
thinair Posted May 13, 2019 Share Posted May 13, 2019 Excellent points MD2. who needs Bean I expect all Westjetters will still act like owners also. That is if they are aware of airline history and want the company to be successful. I for one, feel a mild sense of relief, a little weight taken off my shoulders. Hope its not vertigo. lol Link to comment Share on other sites More sharing options...
Guest Posted May 13, 2019 Share Posted May 13, 2019 Holly cow batman. Best of luck to all in their new future. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.