Transport Canada Reviews WestJet and Sunwing Deal

WestJet and Sunwing planesTransport Canada announced on 20MAY it will be conducting a “public interest assessment” of WestJet’s proposed acquisition of Sunwing Vacations and Sunwing Airlines.

WestJet officially announced the proposed acquisition on 02MAR, and according to Transport Canada, WestJet Airlines Ltd. and Sunwing Travel Group notified the Minister of Transport, Omar Alghabra, of the proposal on 08APR in accordance with the mergers and acquisitions provisions of the Canada Transportation Act.

The Minister of Transport has determined that the transaction “raises public interest considerations related to national transportation.” As such, a public interest assessment of the proposed transaction will be conducted with input from the Commissioner of Competition, who will assess “impacts on competition.”

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According to Transport Canada, the public interest assessment will include consultations with the air industry and other stakeholders, other government departments, other levels of government, as well as the public. The assessment will include an analysis of the “economic benefits or challenges resulting from the proposed transaction.”

Under the Canada Transportation Act, Transport Canada has up to 150 days to complete this public interest assessment. However, the Minister has the authority to grant an extension should extra time be necessary. Considering the “size and scope” of the proposed transaction, an extra 50 days has been granted to both Transport Canada and the Commissioner of Competition, to ensure “sufficient time for thorough analysis and assessment.”

Transport Canada now has 200 days, until 05DEC 2022, to complete the public interest assessment and provide it Minister Alghabra. He would then provide a recommendation to the Governor in Council (Cabinet) concerning the proposed purchase. The Minister’s recommendation would incorporate the findings of the Commissioner’s report on competition considerations, Transport Canada said.

There is no legislated timeline for the Minister to make his recommendation or for the Governor in Council to make a final decision.

Should the acquisition be approved, WestJet/Sunwing would be Canada’s #2 airline and #1 tour operator, aviation expert Robert Kokonis, president and managing director of AirTrav Inc. told Open Jaw on 03MAR.

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