Onex Corporation is now in control of WestJet.
Onex and its affiliated funds and WestJet Airlines Ltd. today announced they have completed their transaction' which is valued at approximately $5 billion including assumed debt. The closing comes following the receipt of the final regulatory approval on Tuesday by the Canadian Transportation Agency of its determination under the Canada Transportation Act.
Pursuant to the Arrangement, shareholders of WestJet are entitled to receive $31.00 in cash for each share held at the effective time of the Arrangement. A form of letter of transmittal pursuant to which registered shareholders of WestJet can submit their share certificates in order to receive the cash consideration under the Arrangement is being mailed to all registered shareholders. A copy of the letter of transmittal has been filed on WestJet's profile at www.sedar.com and is being posted on WestJet's website. Shareholders of WestJet who hold their shares through a broker are not required to submit a letter of transmittal; rather they will receive the cash consideration through their brokerage account.
The WestJet common shares will be delisted from the Toronto Stock Exchange within a few trading days. Due to closing of the Arrangement having occurred before December 18, 2019, the former public shareholders of WestJet will not receive the previously declared quarterly dividend to be paid on December 31, 2019.
Onex' portion of the total equity investment was approximately $345 million (US$265 million) as a Limited Partner in Onex Partners V. Further terms of the transaction are not being disclosed.
The proposed acquisition of WestJet Airlines by an affiliate of Onex, would continue to meet the Canadian ownership and control requirements, the Canadian Transportation Agency on Tuesday.
The Canadian Transportation Agency announced Tuesday WestJet and Swoop Inc. would continue to meet the Canadian ownership and control requirements following the proposed $3.5 billion acquisition of WestJet Airlines Ltd. by an affiliate of Onex.
In an email to CBC, Onex said it is pleased to have received approval from the minister of Transport and the Competition Bureau for the WestJet transaction.
"Onex is engaged with the CTA on the regulatory approval process of our transaction."
The Agency's determination that WestJet and Swoop Inc. would remain Canadian is on the condition that Onex amends its by-laws to ensure that any matters pertaining to and affecting WestJet Airlines Ltd, WestJet and Swoop Inc, are voted on at Board of Directors' meetings where a majority of Canadian directors are present.
The Agency has directed Onex to provide copies of any document, previously submitted as draft, in their final executed form, within 60 days of the completed transaction.
The Agency reminded Onex that the requirement to be Canadian is an ongoing requirement, and that for WestJet and Swoop Inc. to remain Canadian, Onex must remain Canadian. WestJet and Swoop Inc. must notify the Agency of any change to their Canadian status.
WestJet issued a statement Tuesday evening acknowledging the issuance and is in the process of reviewing the determination.
On May 31, 2019, Onex, a publicly-traded company and asset manager, filed an application with the Agency requesting an advance determination as to whether WestJet and Swoop Inc. would continue to meet the Canadian ownership and control requirements following the proposed acquisition. WestJet Airlines Ltd. is the parent company to WestJet and Swoop Inc., which hold Agency licences. Onex proposed to acquire 100% of the company through an affiliate company.
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