Some interesting developments with AC. It looks like AC is trying its best to put pressure on CA's wallet as much as possible. Canadian is strapped for cash, so the longer into the winter that AC can delay the deal the worse it is likely to hurt Canadian financially, since winter is their worst season financially. Furthermore, Air Canada's seat sales (which have been matched by CA) increases the pressure on CA's top line.
Now, quoting from yesterdays ONEX press release:
Onex believes that the 90-day period provided for by the Government of Canada's section 47 order is ample time for the development and consideration of restructuring proposals.
"Air Canada is acting contrary to the process set out by the Government, which Onex has been careful to follow," said Mr. Wright. "The effect is to deny Air Canada shareholders the opportunity to register their decision on the Onex offer, or any other offer that comes forward, in a timely fashion."
So ONEX is now going to go to court to get a judge to force them to hold the meeting to consider the ONEX bid on November 8, rather than on January 7, as AC has scheduled. This should be interesting. First, it appears that ONEX will be trying to convince the judge that AC's selection of January 7 for the meeting date is somehow an unreasonable length of time. But its only about 130 days from now which doesn't seem particulary unreasonable to me, seeing as ONEX is proposing a 90-day time period. Of course, ONEX will find itself in the position of convincing a judge that the shorter time is better, even though a formal offer hasn't been received by Air Canada's management or its shareholders!
Regards,
John Sladek |
