briantoronto

The Macker

Wow, there goes "We are owners and we care" tag line. Business like Onex are not long term owners, typically they will own it for less than 5 years. During their ownership, the focus is on increasing profit so they can resell the business for much higher price down the road. I guess the turmoil with all the changes (which in my opinion) have been poorly implemented. Oh well, I will watch the turmoil continue.

Altaflyer

Arthurrs

I certainly didn't see that coming!!

aerobod

YXUFlyboy

Ugh. I guess time will tell but this deal is disappointing to me. Private equity firms are notorious for buying companies, restructuring them to maximize profit, and then selling them again in about a 5-year investment window. WestJet is profitable but I can see Onex shifting WestJet away from more interesting and risky routes towards their more traditional LCC business model. I wonder how much this will impact WestJet's shift to a full-service carrier, and how much capacity now moves to YYZ as a result. They've really invested in YYC.

tcook052

An interesting twist indeed and I can't help but think this doesn't bode well for the union-management relations.

Arthurrs

With the way things are currently, can it get any worse?? Time will tell. Not a done deal until the end of this year, or sometime next year. You have to wonder if current negotiations will drag on, or come to a quick conclusion before the deal is finalized.

Fiordland

Yes, not good for the employees however the unions are usually not supportive of the "we are owners" mentality. This moves WestJet closer to what unions are use to having.

FlyerTalker70

Says who? While the takeover may be classified as friendly, that's a mere distinction in the nature of the transaction (i.e. how much money and whose hands that money is being doled out to). Once acquired, Onex can do whatever they want with the company, laying off workers, reducing salaries, etc. The only thing WS has going for them now is their labour Union. At the end of the day Onex bought the company because they thought they would turn a profit from the company either by holding the company (keeping the structure the same), improving the organization (i.e. eliminating redundancies) and/or selling the company at a later time.

That's always a potential risk with takeovers. I would also point out that given Onex spent so much money on the takeover I fail to see how they would have money left over to focus on route expansion and fleet upgrades. This is to say nothing of the lack of lounges they have network wide and the dismal quality of their front cabin in comparison to AC. The company's success, and the success of many airlines is inversely correlated with the success of YYC. High oil prices are bad for the airlines who are now seen as geniuses in this low energy price market which as we know won't last forever.

However, there may be a silver lining to this development. Perhaps Onex will make WS fares competitive once and for all rather than be priced $10 cheaper than the comparable AC fare. For the longest time I have avoided flying them since the $10 savings in airfare was often minimal compared to the *Gold benefits I got flying AC (i.e. lounge access, IRROP handling, etc.). Here's to hoping we once and for all see $90 fares between YXU and YUL! Perhaps new management will see the light in having WS join an alliance like SkyTeam instead of their current sorry state which can leave travellers stranded on complex itineraries ticketed with them.

I always thought WS was a non-Union shop that just gave their employees decent labour conditions... boy was I wrong! One thing that is missing from the discussion is whether the Competition Bureau would approve the transaction on these grounds specifically. I suspect WS shareholders have no objections to this offer

5mm

YEG USER

As an employee of a company (in a completely different industry), that was taken over in a friendly takeover with the promise of "no fundamental changes" I call BS. If things do stay the same, it'll only be in the short term.

EDIT - I'm not saying that there will be major changes. I'm just saying that a friendly take-over is by no means a guarantee that things will stay the same.

aerobod

5mm

robsaw

Onex has no signficant ties with AMR except historical and as a business I don't believe those connections carry any current weight.

While a takeover by Onex could be seen in negative terms there is also the fact that Private ownership gets away from the 1/4 by 1/4 focus and allows for potentially better long-term investment in re-making WestJet. Whether that effort stays on the current path or radically changes direction is the main question and all the thoughts here are so far entirely speculative. Onex has held some investments for many years and some for short periods - given the varied history, it is impossible to know what Onex's intents may be in this case.