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WestJet to be acquired by Onex
May 13, 2019 By Wings Staff
WestJet this year began flying its first new 787 Dreamliner, as the Calgary-based airline opens up its global business. (Photo: WestJet) WestJet Airlines Ltd. announced today it has entered into a definitive agreement to be acquired by Onex Corporation in an all-cash transaction valued at approximately $5 billion, including assumed debt.
Under the terms of the agreement, Onex and its affiliated funds will acquire all outstanding shares of WestJet for $31.00 per share, after which WestJet will operate as a privately held company. The purchase price represents a 67 per cent premium to Friday’s closing share price, according to WestJet, and a 63 per cent premium to WestJet’s 20-day volume-weighted average trading price.
“Since our first flight in 1996, WestJet has been singularly focused on providing better options for the Canadian travelling public and this transaction retains that commitment,” said Clive Beddoe, WestJet’s founder and chairman. “I am particularly pleased that WestJet will remain headquartered in Calgary and will continue to build on the success that our 14,000 WestJetters have created.”
Completion of the transaction is subject to a number of conditions, including court and shareholder approval and receipt of certain regulatory approvals, including approval under the Canada Transportation Act. WestJet explains approval under the Canada Transportation Act involves a determination by the Minister of Transport, Marc Garneau, which entails an assessment of the public interest as it relates to national transportation. WestJet expects to close the transaction in the latter part of 2019 or early 2020.
“WestJet is one of Canada’s strongest brands and we have tremendous respect for the business that Clive Beddoe and all WestJetters have built over the years,” said Tawfiq Popatia, a managing director with Onex. “WestJet is renowned internationally for its unparalleled guest experience and employee culture. We’re thrilled to be partnering with WestJetters and continuing this remarkable Canadian success story.”
WestJet explains it was approached by Onex in March 2019 about the purchase, at which time the airline formed a special committee of independent directors to provide the board with recommendations; and to supervise the negotiation of the terms and conditions of the transaction. This led to what WestJet describes as a unanimous recommendation from its board of directors to move forward with the transaction.
“We are delighted to continue the journey of building an airline based on a growing network, providing competitive airfares and more choice to, from and within Canada, for communities large and small. Integral to this relationship is a commitment to our employees, and our unique ownership-driven culture,” said Ed Sims, WestJet’s president and CEO.
