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UPDATE 3-Canadian businessman seeks talks with Transat after deal with Air Canada left in limbo

·2 min read

(Updates with Canadian businessman and Quebec premier)

By Allison Lampert

Feb 16 (Reuters) - Canadian businessman Pierre Karl Péladeausaid on Tuesday night he wants to start talks to acquire TransatA.T., after Air Canada's planned C$188.7million ($148.7 million) takeover of the Montreal-based touroperator was left in limbo.

Air Canada will not extend Monday's deadline for itsacquisition of the company, after European regulators failed togive their approval, Transat said earlier on Tuesday.

Air Canada and Transat are still discussing potentialamendments, and the agreement remains until either party endsit.

Noting that the operator of Air Transat could startnegotiations with a new buyer, Péladeau said in a statement hewould "like to start discussions" with management to allow thebusiness to escape its "grave state of uncertainty."

Péladeau, chief executive of Québecor Inc,previously attempted to acquire Transat in his personal capacityas a businessman.

"I have certain concerns," Quebec Premier Francois Legault,who co-founded Transat in 1986, told reporters on Tuesday night,adding that the province was looking at different scenarios forTransat, with or without Air Canada, the country’s largestcarrier.

Air Canada, also headquartered in Montreal, initiallyreached a deal before the COVID-19 pandemic to buy Transat, in amove to bolster its then-thriving leisure business. It latersteeply discounted the offer.The Canadian government has already approved the deal https://reut.rs/3s46Ztj,subject to conditions.

But the European Commission, which has requested additionalinformation from the companies, is expected to arrive at adecision only in the first half of 2021, Transat said.

"We anticipate that other interested parties will step upand show their interest in Transat," Desjardins analyst BenoitPoirier said in a note to clients.

Onex Corp, which acquired Canada's WestJet in 2019, "couldbe another suitable contender," Poirier said.

Air Canada said earlier in the day it had no update toprovide, while Onex was not available.

Transat shares closed down almost 8%, while Air Canadashares rose almost 5% in Toronto trading.

($1 = 1.2687 Canadian dollars)(Reporting by Shreyasee Raj in Bengaluru and Allison Lampert inMontreal; Editing by Bernadette Baum and Peter Cooney)