Air Canada: Onex Invites Air Canada to Help Find a Solution
9/16/99 14:41
99/09/16 Market News Publishing Inc. No: 000306
ONEX CORP ("OCX-TM")
AIR CANADA ("AC-TMVYW;ACNAF-Q")
- Onex Invites Air Canada to Help Find a Solution
Onex Corporation chairman and chief executive officer Gerald Schwartz,
in Montreal to meet with institutional investors and business leaders,
invited Air Canada management to end its three-week silence and discuss a
constructive solution to the Canadian airline industry's chronic problems.
"No one disputes that Canada's airline industry, as it is now
structured, doesn't work. It doesn't provide meaningful competition, decent
returns to shareholders, job security, or truly national service," said Mr.
Schwartz. "Onex has tabled a proposal that addresses all of those issues."
Mr. Schwartz said that he is puzzled by Air Canada's apparent
unwillingness to discuss a solution to the industry's problems and by its
characterization of the Onex proposal as hostile.
"Under our proposal, the headquarters of the new airline is in
Montreal, the culture will remain fully bilingual, the name will remain Air
Canada, and the senior management of the new airline will most likely come
out of Air Canada," said Mr. Schwartz. "No one will be forced out of a job
in Montreal. What part of 'Yes' don't they understand."
He said he appreciates the obligation of Air Canada to maximize its
shareholder value.
"But you have to look at the value of Air Canada before Onex brought
forward its proposal," said Mr. Schwartz. "The Onex proposal is already
responsible for increasing Air Canada shareholder value. Stock analysts and
investors who follow this industry closely view the value of our offer as
more than $12 a share, which is almost double where the Air Canada share
price was prior to the Onex proposal." |
