AC makes offer to buy Canadian

 

Old Oct 19, 99, 10:46 am
  #1  
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AC makes offer to buy Canadian

AC has offered $92 million to purchase Canadian and continue to operate it as a separate company.

http://newsworld.cbc.ca/cgi-bin/temp...9/aircan991019

and
http://www.aircanada.ca/about-us/news/101999.html

[This message has been edited by megamiles (edited 10-19-1999).]
megamiles is offline  
Old Oct 19, 99, 11:47 am
  #2  
 
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things are really heating up. i was rooting for onex, but if cp goes with dl, that'll work for me because i'm dl gold. it will make more ny access for canada, as now we only have comair to yul and yow.
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Old Oct 19, 99, 12:23 pm
  #3  
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I am against Onex all the way...

The new proposal now sounds a better. However, there are several points I am not quite sure about.
  • Isn't what Air Canada trying to accomplish here to to gain control of Canadian Airlines even though they said they will remain as two seperate companies?
  • This is the point I am most against...Canadian will code share with United and Lufthansa. Doesn't this sounds like merging to anoyone? The bootom line is trying to make Air Canada, Candian, United, Lufthansa into one big company code sharing with each other.
  • AC is trying to gain access to Candian Airlines' international routes. They haven't given up since last time they failed.
  • Canadian code sharing with Delta is actually an excellent idea, however, I believe AC was given benefits by Delta to ask CP to do this.
  • What will happen to Exec. Plat on CP, will they be equivalent to Super Elite on AC? Doesn't that make the qualifying miles up to 100K for Exec plat?
  • Operating a new lost cost airline, sounds like AC will get the profit from it.
  • Last and most important to me, less flights overall, more packed planes, less upgrades, making our status less valuable.

From my personal viewpoint, I think this proposal does Air Canada good in every way. Giving Canadian 92 million will not solve their financial problems. They are trying to use this oppurtunites to grab some of CP's international routes. For some reason, I do not like United Airlines at all, probably based on my experience on them and their reputation. I would not like to see UA and CP in the same alliance, code sharing the same plane.

The best solution right now might be to reject all proposal. I am sure AA will come in to save CP again since they could not afford to lose CP...however, that brings in the problem of foreign ownership again.

Regards,
Empress
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Old Oct 19, 99, 12:50 pm
  #4  
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STAR Alliance members are rescuing AC with a 35% stake.

Isn't that OVER the limit of 25% of shares by a foreign company?

Are other OneWorld members willing to just let Canadian go without a fight? Or a takeover?

Is ONEX just all talk and no action? Would they still buy Canadian and make it a better company to operate?

Isn't the proposal now a disguise in a complete merger? Note that about 10 years ago when Canadian bought Wardair and promised that it would operate it as a different company. Well, that didn't last very long....

Must be a Canadian thing !
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Old Oct 19, 99, 1:29 pm
  #5  
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I think the foreign ownership is 10% per foreign owner plus there is a total foreign ownership maximum but I think it is closer to 50%.
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Old Oct 19, 99, 2:31 pm
  #6  
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Haven't yet seen the details yet, so I'll hold comments until I have. But with regard to foreign ownership. CP is currently max'd out, at 25% voting, and 33% equity. I presume the 35% figure is the 33% rounded to a convenient number for press purposes.

Regards,

Ken Hamer
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