Information provided for reference as supplied to senior officials at Transport Canada on . It has not been updated since that date.

Air Canada’s proposal to acquire Air Transat

Location: National

Summary of Issue/Background

  • On June 27, 2019, Air Canada and Transat A.T. Inc. announced that they have concluded a definitive Arrangement Agreement regarding the proposed purchase by Air Canada of all issued and outstanding shares of Transat and its combination with Air Canada.
  • Based in Montreal, Transat employs 5,000 people and flies roughly 3.5 million passengers a year. Air Transat is a business unit of Transat, a leading integrated international tourism company specializing in holiday travel and offering vacation packages and air travel.
  • Air Canada, which employs 30,000 people, is the flag carrier and the largest airline of Canada by fleet size and passengers carried (roughly 50 million a year). The airline, founded in 1937, provides scheduled and charter air transport for passengers and cargo to 207 destinations worldwide. Air Canada's corporate headquarters are in Montreal, Quebec, while its largest hub is at Toronto Pearson International Airport.
  • As per the provisions of the Canada Transportation Act, on August 26, 2019, the Minister of Transport communicated to the Parties (Air Canada and Transat) that the proposed transaction did raise significant public interest considerations, and that a public interest assessment would be launched by the Department, with public consultations commencing November 4, 2019.
  • Both Transport Canada and the Commissioner of Competition have initiated their reviews.
  • As per the timelines established by Minister Garneau on August 26th, the Commissioner of Competition will provide a report to the Minister of Transport by March 23, 2020. The Department will then consider the input of the Commissioner as it provides its advice to the Minister of Transport by May 2, 2020.
  • The Minister of Transport would then consider this advice and provide a recommendation to the Governor in Council (GiC) concerning the proposed purchase. There is no statutory timeline for the Minister to provide the recommendation to the GiC, nor is there a statutory timeline for the GiC to render its decision.
  • A proposed transaction would also be evaluated by the Canadian Transportation Agency to ensure that the proposed transaction respects the foreign ownership restrictions and that the merged entity would be controlled in fact by Canadians.