Consumers will likely see little change in their travel choices or ticket prices if Air Canada buys Transat AT Inc., industry observers said Friday.
Air Canada shares, meanwhile, rose by 1.6 per cent by 3 p.m. EDT on Friday to a new all-time high of $41.04.He said the offer represents a premium of 148 per cent over the 20-day average share price before Transat announced on April 30 that it was in discussions with unnamed parties for a potential sale.
Transat offers vacation packages, hotel stays and air travel under the Transat and Air Transat brands, with a primary focus on the transatlantic market during the summer and sun destinations through the winter.The timing of Air Canada’s announcement was probably linked to last Monday’s news that Toronto-based Onex Corp. had struck a deal to buy Calgary-based WestJet Airlines Ltd. for about $3.5 billion, thus providing a funding source for growth, said independent airline analyst Rick Erickson.
“I think we certainly need to watch what happens, pay attention, but I think that, having two really strong carriers in Canada, there still will be lots of choice,” she said.She added Canada’s other charter airlines such as Sunwing and Sunquest will continue to provide competition on Transat’s holiday routes.
globebusiness Well, it will devalue the Transat experience to match the bottom of the barrel Air Canada experience.
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