The president of Quebec-based real estate developer Groupe Mach said he plans to make a formal purchase bid for the ownership of Transat, following statements from Transat indicating that it didn’t consider Groupe Mach’s June 4 bid – announced in a press release – to be an official offer.
The Canadian Press reported that Groupe Mach CEO Vincent Chiara intends to make a formal bid for the purchase of Transat; the announcement followed statements made yesterday (June 13) in Transat’s Q2 report and by Transat President & CEO Jean-Marc Eustache, who said that while Groupe Mach’s June 4 bid – valued in excess of $1 billion – has been acknowledged, the company declined to further entertain the offer pending a formal submission.
Groupe Mach’s bid, as detailed in the June 4 press release, would see the involvement of TM Grupo Inmobiliario, the largest residential and leisure real estate developer in Spain and preferred hotel supplier of Transat in Mexico, in exchange for a minority equity stake in Transat, approximately $15,000,000 in cash and roll-over of its three operating hotels in Mexico with approximately 1,000 rooms under the well-established banner of The Fives Hotels and Residences into Transat's platform.
Mach also proposes to remove Transat shares from public trading and stated that in order to satisfy the Quebec government, Transat's head office, executive team and centre of decision-making would be maintained in Montreal and that Mach would “provide assurances that no layoffs of current employees in Transat or its subsidiaries will result from the transaction.”
Groupe Mach previously stated that any offer would be conditional on Transat abandoning purchase talks with Air Canada; in its Q2 statement yesterday, Transat said that the discussions with Air Canada are currently ongoing, citing a a letter of intent signed with Air Canada for the potential acquisition of the company, with an exclusivity period ending June 26.
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