Interest by Quebec property developer Mach in acquiring Canadian travel conglomerate Transat seems fuelled by a desire to exploit hotel room growth in Mexico and the Caribbean. Mach has surprised markets by offering CAD14 per share for Transat, which is higher than Air Canada’s bid of CAD13 per share. Air Canada and Transat are in the midst of wrapping up an exclusive negotiating period.
Transat’s CAD750 million plan to add 5,000 hotel rooms by 2022 in Mexico and the Caribbean likely sparked Mach’s decision to launch a competing bid from the travel company. Mach has declared that it would increase that total to 12,000 rooms in six years, and has secured a pledge from TM Grupo Inmobiliario to invest CAD15 million in Transat for a minority stake in the company. TM was a residential real estate developer in Spain and is also the preferred hotel supplier for Transat in Mexico.
Mach’s executives are also working to allay any concerns about Transat’s airline – Air Transat. Executives from the real estate firm told the Canadian Press that Air Transat, for now, is an integral part of Transat’s business.
After Air Canada made its offer for Transat public, there was speculation over whether Canada’s largest airline would keep Transat’s hotel business, and after Mach made its offer Air Canada stressed it will “create an industry leading, Quebec-based leader in the global leisure travel industry”. Now it is up to Air Canada to decide if creating that leader in the global travel industry is worth upping its bid for Transat.
More Like this
- The changing Canadian landscape – a story of major airline consolidation, privatisation and ULCC new entrantsAugust 30, 2019
- Airline Insight: Air TransatMarch 5, 2018
- Aircraft fleet deal helps ease leisure airline seasonal stressesOctober 3, 2017
- The industry outlook is characterised by uncertainty with caution over capacity and consolidation big themes for 2020February 28, 2020
- Who will emerge as A321neoLR launch operator following Primera Air’s collapse?October 4, 2018
- The ‘tremendous headwinds’ of regulation, how consumers are demanding an elegant interaction while on the move and why Canada’s government gets ‘a solid fail’ – initial insights from CAPA’s Canada Aviation SummitSeptember 11, 2019
- NDC will compile ‘smorgasbord’ of offerings, data analysis has transformed the frequent flyer process and how blockchain is ‘interesting’, but not a priority in the short term – further insights from CAPA’s Canada Aviation SummitSeptember 12, 2019
- Video of the week – Canada Aviation Summit: industry perspectivesOctober 23, 2019
- Montréal Saint Hubert Airport undergoes a renaissance as upgrades open the door to alternative air connections between the main business centres of eastern CanadaSeptember 5, 2018
- Gender equality needs to accelerate – high level female appointments remain few and far between at North American airlinesJune 24, 2019
- WestJet’s Swoop tweaks its distribution to drive improvement in shoulder monthsMay 17, 2019
- Projections for Canada’s hotel industry show notable strength for Toronto during 2018 February 6, 2018